take-home pay

noun

\ ˈtāk-ˌhōm-

Definition of take-home pay

: income remaining from salary or wages after deductions (as for income-tax withholding)

Examples of take-home pay in a Sentence

Recent Examples on the Web

But there is no basis for believing that restricting immigration will do more to boost such workers’ take-home pay than encouraging unionization through labor-law reform, or expanding the Earned Income Tax Credit (EITC). — Eric Levitz, Daily Intelligencer, "We Owe Central American Migrants Much More Than This," 21 June 2018 But in a key move, Treasury officials also cut withholding for employees and pension recipients in early 2018, which boosted take-home pay for up to 90% of workers. — Laura Saunders, WSJ, "What You Need to Know About the New Tax Law (Now That You’re Doing Your Taxes)," 15 Feb. 2019 Don’t expect an economic benefit Advocates for abandoning personal income taxes are driven by the same line of thinking: Cutting the income tax will boost take-home pay for everyone. — Adrian D. Garcia, The Seattle Times, "Is a state with no income tax — like Washington — better or worse?," 10 Sep. 2018 Treasury Secretary Steven Mnuchin has estimated that the new rules will mean more take-home pay for about 90 percent of American workers. — Sarah Skidmore Sell, Houston Chronicle, "Tax bill beginning to deliver bigger paychecks to workers," 3 Feb. 2018 Financial expert and author Dave Ramsey recommends multiplying your monthly take-home pay by 25 percent to determine what your maximum mortgage payment should be. — Nancy Mann Jackson, House Beautiful, "Here's Exactly What It Takes To Buy A Home," 26 Feb. 2019 Her take-home pay from Excel Home Care for 42 hours is just under $400 a week. — Clare Ansberry, WSJ, "Caregivers Do Double Duty to Make Ends Meet," 27 Oct. 2018 The subsidy would in any case boost take-home pay for working-class families and, judging from the results of a recent pilot program in New York City, bring more men and women into the workforce. — W. Bradford Wilcox, WSJ, "‘The Once and Future Worker’ and ‘The Forgotten Americans’ Review: Alienated, Angry, in Need of a Job," 19 Nov. 2018 Now, compare your total monthly payment with your take-home pay. — Brianna Mcgurran, The Seattle Times, "Are you afraid of your college debt?," 23 Oct. 2018

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'take-home pay.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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5 May 2019

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The first known use of take-home pay was in 1942

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More Definitions for take-home pay

take-home pay

noun

Financial Definition of take-home pay

What It Is

Take home pay is the portion of one's salary left after all payroll taxes have been deducted.

How It Works

John Doe has a salary of $100,000. He is paid 26 times per year (every other Friday). The federal and state payroll taxes (Social Security, Medicare, unemployment, and federal withholding) amount to, say, 10% of his salary.

John Doe's salary divided by 26 paychecks equals $3,846.15 per paycheck. However, because John Doe has payroll taxes withheld, his take home pay is actually 90% of that, or $3,461.53.

Why It Matters

Understanding the difference between salary and take home pay is important for anyone trying to create and live on a household budget. Taxes are not the only thing that can affect take home pay. If a person is having alimony, child support, retirement plan contributions, or other money withheld from his or her paycheck, these things will also affect the person's take home pay.

Source: Investing Answers

take-home pay

noun