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Gross-Up Calculator

Do you want to send your employee home with a certain amount of pay? A gross-up calculator helps determine the right gross pay for your employee so they can pocket the net pay you're aiming for.

By Kylie McQuarrie

Staff Writer

Published on August 04, 2020

2 min read

An employee's gross salary differs substantially from the amount they take home on payday. Their employer (that's you!) has to withhold income tax, Medicare and Social Security taxes, and other deductions from their gross pay to write them a check for their net pay.

So what gross pay should you offer an employee to ensure they end up with the net pay you have in mind? Well, you could do a bunch of tricky calculations to add federal taxes and other deductions to the net amount . . . or you could use the free gross-up calculator on this page. You just need your employee's net pay and tax information to get started.

If you'd rather not calculate payroll taxes on your own, Gusto's payroll software will take the trickiest parts of the task off your shoulders—including withholding and remitting taxes to the IRS.

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Gross income calculator information

You don't need much info to calculate gross income. Along with the net pay you have in mind for this particular employee, you'll input the following information:

Your employee's federal tax filing status (married, single, married but withholding at a higher rate, or nonresident alien)
The number of allowances your employee lists on their W-4 tax form

You'll also need the same basic pay information you'd enter in any other type of payroll calculator, including these:

Payment date
Year-to-date pay
Pay frequency (for instance, biweekly, weekly, or monthly)

And don't forget to select your employee's state of residence from the calculator's drop-down menu. State income taxes vary across the country, so if you don't choose the right state, you won't calculate the right local tax withholding amount.

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Pro tip: New 2020 W-4 forms

Employees hired in 2020 should submit a streamlined W-4 form that looks quite different from previous years' forms. Most importantly, the new tax form gets rid of allowances. If your employee submitted a 2020 W-4 form, choose Yes on the calculator's Use 2020 W-4 line and add any information about the employee's additional jobs, dependents, or other income sources as listed on their W-4.

Supplemental flat tax rate

Are you trying to calculate the right gross pay for an employee's bonus? Supplemental income, bonuses included, are subject to a 22% federal flat tax and typical federal and state taxes. If you're using this net-to-gross calculator specifically for a bonus, make sure to check Yes on the Federal Supplemental Flat line.

Gross-up FAQ

What is gross pay?

Gross pay is how much an employee earns before any deductions, which could include taxes, child support payments, health care plan premiums, or 401(k) plans. After deductions, the employee takes home the remaining amount as net pay.

What are payroll taxes?

Payroll taxes is an umbrella term for the taxes an employer withholds from their employees' gross earnings. These taxes include the following:

Federal and state income taxes
FICA taxes, which are Medicare and Social Security taxes
FUTA tax, which is the federal unemployment tax

Employers are required to match their employees' FICA and FUTA tax contributions.

Are bonuses taxed?

Bonuses given in 2020 are subject to a 22% flat federal tax rate along with the typical payroll taxes.

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The takeaway

Working backwards isn't second nature for a lot of us, especially mathematically. Fortunately, the same isn't true of a gross pay calculator—just make sure you're entering the right data to get the most accurate gross-up result.

Do you already have an employee's gross pay and need to calculate their net pay instead? Try this net paycheck calculator to withhold the right amount.

Disclaimer

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Written by

Kylie McQuarrie

Kylie spent two of the last four years writing for and with small-business owners—from dentists in Australia to plumbers in the Midwest. She spent the other two writing in depth about internet and security. She’s passionate about reading, hiking, and dedicating every spare second to writing for fun (at lunch, between meetings, on the train, before breakfast . . . ). Her content helps small-business owners tackle the logistics of running a business so they can focus more on their passions too.