When you look at your Arizona paycheck, you’ll notice two key numbers: gross pay and net pay. They’re not the same, and understanding the difference helps you budget better, compare job offers, and avoid surprises when tax season arrives. Let’s break it down clearly with Arizona-specific details.
Quick Answer
- Gross pay: The total amount you earn before any taxes or deductions.
- Net pay: The actual amount you take home after federal taxes, Arizona state tax, Social Security, Medicare, and other deductions.
What Is Gross Pay?
Gross pay is your earnings before deductions. It’s the starting point of every paycheck.
- Hourly employees: Multiply hourly rate × hours worked. Add overtime at 1.5× for hours over 40 in a week.
- Salaried employees: Annual salary ÷ number of pay periods (weekly, biweekly, or monthly).
Example:
- $20/hour × 40 hours = $800 gross pay
- $52,000 annual salary ÷ 26 pay periods = $2,000 gross per paycheck
What Is Net Pay?
Net pay, also called take-home pay, is what’s left after deductions. These typically include:
- Federal income tax
- Social Security (6.2%) and Medicare (1.45%)
- Arizona state income tax (flat 2.5% in 2025, with Form A-4 allowing 0.5%–3.5% election)
- Pre-tax contributions like retirement or health insurance
Example:
- Gross pay = $800
- Minus ~$120 for federal/FICA
- Minus ~$20 for Arizona state tax
- Net pay ≈ $660
Gross vs Net Paycheck: Side-by-Side in Arizona
| Worker Type | Gross Pay | Net Pay (approx.) |
|---|---|---|
| Hourly ($20/hr, 40 hrs) | $800 | $640–$670 |
| Salary ($52,000/year) | $2,000 | $1,600–$1,650 |
Your numbers will vary depending on how you fill out Arizona Form A-4, your pre-tax benefit elections, and overtime worked.
👉 Want to see how deductions work step by step? Try tools like a land loan payment calculator or a land loan interest calculator. They break down large amounts into smaller, clear numbers—just like your paycheck does.
Why the Difference Matters in Arizona
- Budgeting: Gross pay looks bigger, but net pay is what you actually spend.
- Comparing jobs: Two salaries may look the same, but benefits and deductions affect net pay.
- Tax planning: Arizona lets you choose your withholding rate on Form A-4. Pick higher if you want to avoid tax bills later; lower if you want more in each paycheck.
- Overtime: Hourly workers often see bigger swings between gross and net when overtime is added.
FAQs
What is gross income on an Arizona paycheck?
It’s your total pay before taxes and deductions are applied.
What is net income?
Your take-home pay after all required and elected deductions.
Does Arizona have local income taxes?
No. Only the flat 2.5% state tax applies in 2025.
How does Form A-4 affect my net pay?
It lets you pick how much Arizona state tax is withheld (0.5%–3.5%).
Why is my net pay lower than my gross pay?
Because federal, state, Social Security, Medicare, and benefit deductions reduce your paycheck.
Harry is the creator of ArizonaPaycheckCalculator.com, a trusted resource for accurate and easy-to-use payroll and tax calculators. With a focus on clarity and precision, Harry helps Arizona residents understand their take-home pay, deductions, and withholdings. Dedicated to making complex calculations simple, he combines financial knowledge with user-friendly tools to save users time and confusion.