Direct Answer
The hourly to salary calculator converts your hourly rate to an annual salary by multiplying your rate by hours worked per week by 52 weeks. At 40 hours per week, $20 per hour equals $41,600 per year. The calculator also estimates per-period gross pay and net take-home after 2025 FICA and federal income tax withholding.
How This Is Calculated
The core conversion multiplies hourly rate by hours per week by 52 weeks. The tax estimate uses 2025 IRS rates applied to annual gross.
Step 1: Calculate Annual Gross
Annual gross (no OT) = hourly rate × regular hours per week × 52. If overtime hours are entered, the OT premium (hourly rate × 0.5 × OT hours × 52) is added separately. The base pay for OT hours is already in the regular calculation.
Step 2: Calculate FICA
Social Security: 6.2% × min(annual gross, $176,100 wage base). Medicare: 1.45% × annual gross (no cap).
Step 3: Calculate Federal Income Tax
Federal taxable income = annual gross minus standard deduction for filing status. 2025 marginal brackets are applied to taxable income to produce the annual federal income tax estimate.
Step 4: Calculate Net Take-Home
Annual net = annual gross minus FICA minus federal income tax minus optional state tax (entered flat rate × gross). Per-period figures divide the annual totals by pay periods per year.
Simplified calculation notice: This calculator uses the standard deduction only and applies a simplified annual tax rate. It does not simulate per-paycheck withholding per IRS Pub. 15-T tables, nor does it account for W-4 elections, pre-tax benefit deductions, or Additional Medicare Tax (0.9% above $200,000). Results are estimates, not payroll withholding calculations.
Assumptions
- Standard deduction applied for the selected filing status
- No pre-tax deductions (401k, health insurance, FSA, HSA)
- No tax credits applied
- Overtime rate: 1.5× for all OT hours entered (FLSA standard)
- 2025 SS wage base of $176,100
- State tax applies as a flat rate on gross (if entered)
Frequently Asked Questions
How many hours per year does the annual salary calculation assume?
The standard full-time work year is 2,080 hours. This comes from 40 hours per week multiplied by 52 weeks. At 40 hours per week, your annual gross salary equals your hourly rate multiplied by 2,080. If you work a different number of hours per week, adjust the regular hours field. The calculator uses your actual input, not a fixed 2,080-hour assumption.
Does this calculator account for overtime pay?
Yes. Enter the number of overtime hours per week in the OT hours field. The calculator applies the standard 1.5x overtime rate to those hours. For example, 5 overtime hours per week at $20 per hour adds $30 per overtime hour, for $150 per week above regular pay. The annual overtime premium is added to your base annual salary to produce total annual gross.
How does my hourly rate affect FICA taxes versus federal income tax?
FICA taxes and federal income tax work differently. Social Security tax is 6.2% of wages up to $176,100 for tax year 2025. Medicare tax is 1.45% of all wages with no cap. Both apply from the first dollar of wages. Federal income tax is calculated on taxable income after subtracting the standard deduction. The result is graduated by bracket, so lower income is taxed at lower rates before reaching higher brackets.
Why does my actual take-home differ from hourly rate times 2,080?
Because taxes are subtracted before you receive your paycheck. Your hourly rate times 2,080 gives you annual gross pay. From gross pay, your employer withholds federal income tax, Social Security tax (6.2%), and Medicare tax (1.45%). Many employees also have pre-tax benefit deductions such as health insurance premiums and 401(k) contributions. Use the
Take-Home Pay Calculator to include benefit deductions.
Can I use this calculator if I work part-time?
Yes. Change the regular hours per week field to your actual hours. For example, a part-time worker at 20 hours per week earning $18 per hour has annual gross pay of $18,720 (18 × 20 × 52). A lower annual income will generally result in a lower effective federal tax rate, so the net pay percentage will be higher for part-time workers than for full-time workers at the same hourly rate.
What is the Social Security wage base for 2025?
The Social Security wage base for tax year 2025 is $176,100. Wages above this threshold are not subject to the 6.2% Social Security tax. Medicare tax at 1.45% applies to all wages with no cap. An additional 0.9% Medicare surtax applies to wages above $200,000 for single filers and $250,000 for married filing jointly, but this is not included in this calculator's estimate.
How do I compare an hourly offer to a salaried offer?
Convert the hourly offer to an annual equivalent using this calculator, then compare to the salary offer. Note that salaried positions often include paid time off built into the compensation, while hourly positions pay only for hours worked. A salaried exempt employee receives no overtime premium. An hourly non-exempt employee is entitled to overtime pay under the FLSA for hours over 40 per week. This difference becomes significant in roles with frequent overtime.
Does the hourly to salary calculation include paid time off?
This calculator assumes you are paid for all weeks in the year, including paid time off weeks. The formula multiplies your hourly rate by hours per week by 52. If your employer pays you for 2 weeks of paid vacation at your regular rate, those weeks are already reflected in the 52-week calculation. If you have unpaid time off, reduce the weekly count accordingly when estimating actual annual earnings.