How do I figure out my Arizona paycheck after taxes?

If you work in Arizona, one of the most common questions is: “How do I figure out my paycheck after taxes?” This guide is designed for employees and self-employed workers who want to understand their take-home pay and make informed financial decisions.

Step-by-Step: How to Calculate Your Arizona Paycheck

1. Start with Gross Pay
   • Hourly: Multiply your hourly rate by hours worked.
   • Salary: Divide your annual salary by the number of pay periods.
2. Subtract Federal Income Tax
   • Based on your W-4, filing status, and IRS tax brackets (10%–37%).
3. Subtract FICA Taxes
   • Social Security: 6.2%
   • Medicare: 1.45% (plus 0.9% if income exceeds $200,000).
4. Subtract Arizona State Tax
   • Flat rate of 2.5% on all income.
5. Account for Other Deductions
   • Retirement contributions (401k, IRA)
   • Health insurance premiums
   • Employer-specific deductions

Real-Life Examples

Example 1: Salary Employee

• Gross pay: $4,000/month
• Federal tax: ~$400
• Social Security: $248
• Medicare: $58
• Arizona tax: $100
• Take-home pay ≈ $3,194

Example 2: Hourly Employee

• 40 hours/week × $20/hour = $800 gross per week
• Federal tax: ~$80
• Social Security: $49.60
• Medicare: $11.60
• Arizona tax: $20
• Take-home pay ≈ $639

Why This Matters

• Helps you budget more accurately
• Shows the impact of taxes and deductions
• Prepares you for savings, retirement, or side income planning

Common Questions About Arizona Paychecks

1. What is Arizona’s income tax rate in 2025?

Arizona has a flat 2.5% state income tax rate for all income levels.

2. How do I calculate net pay if I’m hourly?

Multiply your hours by your hourly rate, then subtract federal tax, Social Security, Medicare, and 2.5% Arizona tax.

3. Does Arizona tax bonuses?

Yes, bonuses are taxed as regular income and subject to the same 2.5% state tax plus federal and FICA taxes.

4. Can I reduce my Arizona paycheck taxes?

Yes. Contributing to retirement plans or paying for health insurance with pre-tax dollars lowers taxable income.

5. Why is my paycheck lower than expected?

Withholding differences, benefit deductions, and retirement contributions reduce your net pay beyond just taxes.

6. Do I need a paycheck calculator?

Not required, but using an Arizona paycheck calculator saves time and ensures accuracy when estimating take-home pay.

7. How often are Arizona paychecks taxed?

Taxes are withheld every paycheck, whether weekly, bi-weekly, or monthly, based on your pay frequency.