Hourly Pay Calculator
Convert between hourly, daily, weekly, biweekly, monthly, and annual pay. Enter values for instant results with step-by-step formulas.
Reviewed for accuracy by Raz Mohammad, Tax & Salary Specialist
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 shift differentials or 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.
How is net pay calculated from gross pay?
Net pay is what remains after every deduction is subtracted from gross pay. The order matters: start with gross earnings, subtract pre-tax items (traditional 401(k) contributions, HSA/FSA contributions, and most employer health premiums), which lowers the wage base used for income tax. Payroll taxes come next — Social Security at 6.2% up to the annual wage base and Medicare at 1.45% with no cap, both calculated on a base that pre-tax health and retirement deferrals reduce differently. Then federal, state, and any local income tax withholding is applied per your W-4 elections. Finally subtract post-tax items such as Roth 401(k) contributions, union dues, and wage garnishments. Two people with identical gross pay routinely take home very different net pay purely because of these elections.
Does a raise ever reduce my net pay?
Tax brackets alone cannot reduce net pay, because only the income inside a higher bracket is taxed at that higher rate — earning one more dollar in a 24% bracket still leaves you 76 cents ahead. What genuinely can cut take-home pay is a benefit cliff: crossing an eligibility threshold for a subsidy, income-driven student loan repayment, or a means-tested credit can withdraw more than the raise adds. Employer plan rules matter too, since a raise raises the dollar value of a percentage-based retirement deferral and that larger contribution reduces net pay even though total compensation went up. Check thresholds, not brackets, when a raise appears to cost you money.
References
Reviewed for accuracy by Raz Mohammad, Tax & Salary Specialist · Editorial policy
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