Hourly Pay Calculator
Convert between hourly, daily, weekly, biweekly, monthly, and annual pay. Include overtime calculations and tax estimates for comprehensive compensation
Hourly Pay Calculator
Calculator
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Formula: Hourly Rate = Annual Salary / (Hours/Week x Weeks/Year) | OT Rate = Hourly x Multiplier
Worked example — $36.06/hr | $6,250/mo gross | $4,687.50/mo after tax
Formula
Hourly Rate = Annual Salary / (Hours/Week x Weeks/Year) | OT Rate = Hourly x Multiplier
The calculator converts between pay periods using standard time relationships: 8 hours per day, 5 days per week, and the specified weeks per year (default 52). Overtime is calculated at the specified multiplier (default 1.5x) for hours beyond the standard work week. Tax deductions are applied as a simple effective rate percentage.
Worked Examples
Example 1: Annual Salary to Hourly Breakdown
Problem:Convert a $75,000 annual salary to all pay periods, 40 hrs/week, 52 weeks, with 25% effective tax rate.
Solution:Hourly = $75,000 / (40 x 52) = $75,000 / 2,080 = $36.06/hr Daily = $36.06 x 8 = $288.46 Weekly = $36.06 x 40 = $1,442.31 Biweekly = $1,442.31 x 2 = $2,884.62 Monthly = $75,000 / 12 = $6,250.00 After Tax Annual = $75,000 x 0.75 = $56,250 After Tax Monthly = $4,687.50
Result:$36.06/hr | $6,250/mo gross | $4,687.50/mo after tax
Example 2: Hourly with Overtime
Problem:Calculate total pay for $22/hr with 10 hours overtime per week at 1.5x, 50 working weeks.
Solution:Regular weekly = $22 x 40 = $880 OT rate = $22 x 1.5 = $33/hr OT weekly = $33 x 10 = $330 Total weekly = $880 + $330 = $1,210 Annual base = $880 x 50 = $44,000 Annual OT = $330 x 50 = $16,500 Total annual = $60,500
Result:$22/hr base | $33/hr OT | $60,500 total annual
Frequently Asked Questions
How do you convert an annual salary to an hourly rate?
To convert an annual salary to an hourly rate, divide the total yearly salary by the number of working hours in a year. For a standard full-time employee working 40 hours per week for 52 weeks, the total annual hours are 2,080. So a $60,000 annual salary equals $60,000 / 2,080 = $28.85 per hour. If you take vacation time (e.g., 2 weeks unpaid), you would use 50 weeks instead: $60,000 / (40 x 50) = $30.00 per hour. This distinction matters when comparing job offers — a $28/hour position with paid time off may be more valuable than a $30/hour contract with no benefits. Always account for actual working weeks and hours to get an accurate comparison.
What is the difference between gross pay and net pay?
Gross pay is the total amount earned before any deductions, while net pay (take-home pay) is the amount received after all deductions are subtracted. Deductions typically include federal income tax, state income tax (where applicable), Social Security tax (6.2% of wages up to $168,600 in 2024), Medicare tax (1.45% of all wages, plus 0.9% above $200,000), health insurance premiums, retirement contributions (401k, 403b), and other voluntary deductions like flexible spending accounts. For a typical single filer earning $60,000, effective total deductions might be 25-32% of gross pay, meaning net pay could be $40,800-$45,000. Understanding the gross-to-net conversion is essential for budgeting and comparing compensation packages.
How does overtime pay work under US labor law?
Under the Fair Labor Standards Act (FLSA), non-exempt employees must be paid at least 1.5 times their regular hourly rate for all hours worked beyond 40 in a single workweek. Some states have additional overtime rules — California, for example, requires overtime after 8 hours in a single day and double-time after 12 hours. Exempt employees (typically salaried workers in executive, administrative, or professional roles earning above $35,568 annually) are generally not entitled to overtime pay. The overtime rate is calculated on the regular hourly rate, not including bonuses unless they are non-discretionary. Employers who fail to pay required overtime face penalties, back pay obligations, and potential legal action under both federal and state law.
How should I compare hourly pay vs salary offers?
Comparing hourly and salaried positions requires looking beyond the base numbers to total compensation value. First, convert both to equivalent annual amounts using Hourly Pay Calculator. Then consider: benefits value (health insurance typically worth $5,000-$15,000 annually per individual, more for family coverage), retirement contributions (a 4% 401k match on $60,000 = $2,400/year), paid time off (10 days PTO at $30/hour = $2,400 value), overtime eligibility (hourly workers often earn time-and-a-half, adding 15-25% to income), job stability and predictability of hours, and career advancement trajectory. A salaried position at $55,000 with full benefits can easily be worth more than a $30/hour contract position ($62,400 annually) without benefits.
What is the federal minimum wage and how do state minimums differ?
The federal minimum wage in the United States has been $7.25 per hour since July 24, 2009, making it the longest period without an increase since the minimum wage was established in 1938. However, 30 states plus Washington D.C. have set higher minimum wages. As of 2024, Washington state leads at $16.28, followed by California at $16.00, New York at $15.00-$16.00 (varying by region), and Washington D.C. at $17.50. Some cities have even higher local minimums — Seattle at $19.97 and San Francisco at $18.67. Tipped workers can be paid a federal minimum of $2.13 per hour if tips bring total compensation above $7.25. The disparity between federal and state minimums means the effective minimum wage varies dramatically by location.
Why is my monthly pay not simply four weekly paychecks?
A year has 52 weeks but only 12 months, so an average month is 52 divided by 12, or about 4.33 weeks. On a biweekly cycle there are 26 pay dates, roughly 2.17 per month, which means two months each year contain three paychecks instead of two. Semi-monthly pay avoids this by fixing 24 equal dates but produces checks covering unequal numbers of workdays. The calculator converts through annual hours precisely to sidestep the mistake of multiplying a weekly figure by four.
What makes a worker exempt rather than non-exempt from overtime?
Job title alone decides nothing. Under the FLSA an exemption generally requires three things together: payment on a salary basis, a salary at or above the threshold in the current regulations, and primary duties that fit a recognised exemption such as executive, administrative or professional. Two carve-outs matter: outside sales employees are exempt from both the salary-basis and salary-level tests, and certain computer employees may instead be paid hourly at a specified rate. Otherwise, fail any leg and the employee is non-exempt and owed overtime, however senior the title sounds. The salary threshold is revised periodically, so confirm the figure in force for the year in question.
How do shift differentials and production bonuses change the overtime rate?
Overtime is computed on the regular rate, which is all straight-time compensation for the week divided by hours worked, not merely the posted base wage. A 20 dollar base wage plus a 2 dollar night shift differential gives a 22 dollar regular rate, so the overtime hour is 33 dollars rather than 30. Nondiscretionary bonuses tied to output, attendance or quality must be folded in the same way and retroactively allocated if paid later. Truly discretionary gifts and most paid leave payouts stay outside the calculation.
What hourly rate should a freelancer quote to match an employee's wage?
A contractor covers costs an employer would otherwise absorb, so matching a wage dollar for dollar leaves them worse off. Add the full 15.3 percent self-employment tax rather than the employee half of FICA, the cost of buying individual health coverage and funding retirement without a match, and unpaid time for holidays, illness and admin. Then divide the target annual income by realistically billable hours, which are usually well below 2,080. Enter that reduced hours figure in the weeks and hours fields to see the true equivalent rate.
How is the daily rate derived, and what if I work four ten-hour days?
The tool assumes a five-day week, so the daily figure is weekly hours divided by five: a 40-hour week gives 8-hour days at eight times the hourly rate. On a compressed four by ten schedule the weekly total is unchanged, so the annual and hourly conversions still hold, but the displayed daily amount understates a real workday by two hours. Federal overtime is triggered by hours over 40 in a workweek, not by long days, though states such as California impose daily overtime unless a valid alternative workweek schedule is adopted.
References
Reviewed for accuracy by Raz Mohammad, Tax & Salary Specialist · Editorial policy
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