Pay Raise & Salary Increase Calculator

How much of a raise you actually keep

A raise is taxed at your marginal rate, not your average rate, so you keep a smaller share of the new dollars than of your existing pay. A 5% raise on $60,000 is $3,000 a year before tax. A single filer keeps about $2,411 of it in Texas (80%), $2,192 in California (73%) and $2,236 in New York (75%), once federal tax, Social Security, Medicare and state tax are taken out. The New York figure excludes New York City income tax, which would lower it further.

Your take-home pay still goes up with every raise. US income tax brackets only tax the dollars above each threshold at the higher rate, so there is no salary at which a raise lowers your wage income after tax.

Extra take-home per paycheck, by salary and raise

Single filer in a state with no income tax (Texas), 2026 federal tax and FICA, biweekly pay.

Is the raise beating inflation?

A raise only increases what you can buy if it is larger than the rise in prices over the same period. The Bureau of Labor Statistics publishes the Consumer Price Index (CPI-U) monthly; compare your raise with the 12-month change in CPI-U for the month your raise takes effect.

The real raise is (1 + raise) ÷ (1 + inflation) − 1. For example, a 5% raise in a year when prices rose 3% is a real raise of 1.05 ÷ 1.03 − 1 = 1.9%, not 2%. A 2% raise in that same year would be a real pay cut of about 1%.

Where a raise can cost you more than the tax

Brackets never take back more than the raise, but some income-tested benefits phase out as you earn more. In those ranges, a raise can be worth noticeably less than the table suggests.

• Earned income tax credit: with two children, a single parent’s 2026 credit starts shrinking above $23,890 of income and disappears at $58,629.
• Child tax credit: falls by $50 per $1,000 above $200,000 ($400,000 joint).
• Tips and overtime deductions: both begin phasing out above $150,000 of modified AGI ($300,000 joint).
• Non-tax benefits such as ACA premium tax credits, Medicaid, SNAP, childcare subsidies and income-driven student loan payments also depend on income and are not included here.

Negotiating and planning around a raise

• Translate the offer into the unit you think in. A $4,000 raise is about $1.92 more per hour on a 2,080-hour year and about $154 more gross per biweekly check.
• Ask when it takes effect. A raise starting in July adds only half its annual amount to this year’s income.
• Consider increasing your 401(k) contribution by part of the raise. You still see a bigger paycheck, and the deferred part avoids income tax at your marginal rate.
• Revisit your W-4 if the raise is large or you have a second job, so withholding keeps up with your higher bracket.

Worked example: a family’s $5,000 raise

A married couple filing jointly with two children, earning $90,000 in Texas, gets a $5,000 raise. Their federal income tax goes from $2,040 to $2,640, and Social Security and Medicare rise by $383. Take-home pay rises by $4,018 a year, or $154.52 per biweekly paycheck — 80% of the raise. Their child tax credits are unaffected, because the phase-out doesn’t start until $400,000.

Hourly workers can translate raises the same way: each $1 an hour is $2,080 a year at full time, before tax.

The raise you need just to keep up

Because the extra dollars are taxed at your marginal rate, your gross raise has to be slightly bigger than inflation for your take-home pay to keep pace. For a single filer on $60,000 in a state with no income tax: