How much is a 5% raise after taxes?

A 5% raise on a $75,000 salary adds $3,750 in gross pay. After federal tax (22% bracket), FICA (7.65%), and a 5% state tax, you keep roughly $2,100–$2,400 — about 56–64 cents per raise dollar. Use this calculator to see the exact amount for your bracket and state.

How does a raise affect my tax bracket?

A raise only pushes income in the new, higher bracket — the portion below the threshold is still taxed at lower rates. So if you're in the 22% bracket and a raise pushes a small amount into the 24% bracket, only that excess is taxed at 24%. Most raises don't cause a dramatic jump in overall taxes.

What is a good annual raise percentage?

A cost-of-living adjustment (COLA) typically runs 2–4%. A merit raise is usually 3–6%. A promotion can yield 10–20%. Switching jobs is the highest-leverage move, often producing 15–30% increases. Anything above inflation (roughly 3%) represents a real pay increase.

How do I negotiate a raise effectively?

Research market rates on Glassdoor, LinkedIn, and Levels.fyi. Document specific accomplishments with measurable impact. Request a meeting during a performance review cycle or after a major win. Ask for 10–15% above your target to leave room for negotiation, and be prepared to justify why your contributions warrant the increase.

Pay Raise Calculator — After-Tax Raise & Take-Home Pay

Item	Current	After Raise
Gross Salary	$75,000	$78,750
Federal Tax	$16,500	$17,325
FICA (SS + Medicare)	$5,738	$6,024
State Tax	$3,750	$3,938
Take-Home (Net)	$49,013	$51,464

1

Enter Current Salary

Input your current gross annual salary. This is the baseline for computing the raise percentage and the new tax bracket impact.

2

Enter Raise Amount or Percentage

Specify the raise as a dollar amount, percentage increase, or new salary level. Typical merit raises are 3–5%; promotion raises 10–20%; new-job raises 15–30%+.

3

Select Filing Status and State

Choose your federal filing status and state of residence. Both affect how much of the raise you actually keep after taxes.

4

Apply Inflation Adjustment

Toggle the inflation adjustment to see your real (purchasing-power) raise. A 3% raise during 4% inflation is actually a 1% pay cut in real terms.

5

Review Net Take-Home Change

Inspect your monthly and annual take-home change after federal tax, state tax, FICA, and any benefit contribution adjustments.

Net Take-Home Change

Net Increase = Gross Raise × (1 − Marginal Federal Rate − State Rate − FICA Rate)

Effective marginal rate for most middle-income workers: 22% federal + 5% state + 7.65% FICA = ~35% lost to taxes. $5,000 raise → $3,250 net.

Real (Inflation-Adjusted) Raise

Real Raise % = ((1 + Nominal Raise %) / (1 + Inflation Rate)) − 1

A 4% raise during 3% inflation is a 0.97% real raise. During 5% inflation, that same 4% nominal raise is a 0.95% real pay cut.

Editorial accountability

Author: Calculover Editorial Team - Compensation and tax education

Owner: Calculover Tax & Payroll Desk - Compensation methodology owner

Last reviewed: 2026-05-14

Last verified: 2026-05-14

Data effective: 2026-01-01

Methodology

Pay Raise Calculator computes net take-home increase from a salary raise using the user-entered current salary, raise amount, filing status, state, and marginal-rate assumptions. Real (inflation-adjusted) raise is computed using the user-entered inflation rate.

Assumption: Pay Raise Calculator relies on the user-entered salary, raise, filing status, and state values and does not access payroll or tax records directly.

Assumption: Marginal tax rates are estimated using current federal brackets, state rate approximations, and FICA percentages; actual tax bills depend on full tax-return details.

Assumption: Benefit changes (401(k) match, bonus targets, equity) are not embedded unless explicitly modeled.

Limitations & guidance

Pay Raise Calculator does not predict future tax-law changes, COLA adjustments, or salary trajectory.

Self-employment, supplemental income, alternative minimum tax, and stock-option exercises may produce different effective marginal rates than the basic estimate.

Professional guidance: Pay Raise Calculator is for compensation-planning education only and is not tax, financial, or career advice. Complex compensation situations should be reviewed with a CPA or financial advisor.

Primary sources

Tax Withholding Estimator - Internal Revenue Service

Consumer Price Index - U.S. Bureau of Labor Statistics

Topic 401 — Wages and Salaries - Internal Revenue Service

Cost-of-Living Adjustment (COLA) Salary increase intended to maintain purchasing power against inflation. Distinct from merit raises — COLA typically matches CPI inflation; merit raises exceed it.

Merit Increase Performance-based salary increase, typically 3–5% in normal years. Reflects individual contribution above the COLA baseline.

Bracket Creep When a raise pushes part of your income into a higher tax bracket. Only the marginal dollars are taxed at the higher rate — total tax doesn't jump discontinuously.

Real Wage Wage adjusted for inflation, expressed in constant purchasing-power dollars. Real wage growth has averaged 0.5–1.5% annually in the US since 2000.

Marginal Tax Rate The federal + state + FICA rate applied to your next dollar of earned income. Determines how much of a raise you actually keep after taxes.

Benefit-Loaded Raise Total compensation increase including not just base salary but also 401(k) match increases, bonus targets, equity grants, and benefit upgrades. Often 20–40% larger than the headline raise.

📈

Standard Merit Raise

Annual 4% raise on $80K salary

Current Salary $80,000 Raise % 4% New Salary $83,200 Marginal Rate (Fed+State+FICA) ~30% Net Take-Home Increase ~$2,240/year ($86/biweekly)

$3,200 gross raise nets $2,240 — 30% disappears to taxes. Real raise: 1% after 3% inflation. Modest but meaningful for typical merit cycles. Compounded across 10 years, 4% annual raises produce 47% nominal salary growth.

🚀

Promotion-Driven Raise

Senior promotion with 15% raise

Current Salary $110,000 Raise % 15% New Salary $126,500 Marginal Rate ~32% Net Take-Home Increase ~$11,220/year

Promotion gross raise: $16,500. Net after taxes: $11,220 — $935/month additional take-home. Plus likely bumped 401(k) match and bonus target increase. Promotion-driven raises typically outperform merit cycles for career trajectory.

💼

New-Job Negotiation

Job change with 25% raise

Current Salary $95,000 New Job Offer $118,750 (+25%) Marginal Rate ~32% Net Take-Home Increase ~$16,150 Bonus + 401(k) Match Adjustment +$3,800 estimated

Job changes typically produce the largest raises — 15–30% is common, vs 3–5% for staying. Net of taxes plus benefit improvements, the job change adds ~$20K in total compensation. Worth running a 5-year scenario before deciding.

A pay raise feels like a financial win, but the headline number tells only part of the story. Taxes, benefit changes, and inflation can transform a seemingly generous raise into a modest real-income increase — or even a pay cut in purchasing-power terms.

The Tax Bite on a Raise

Every additional dollar earned is taxed at your marginal rate, not your average rate. For a middle-income earner, this is typically 22% federal + 4–7% state + 7.65% FICA = roughly 32–37% total. A $5,000 raise nets approximately $3,000–$3,400 in take-home pay. High earners ($200K+) face even steeper marginal rates: 32% federal + state + 2.35% additional Medicare = 40–46% total. This is why high-income raises feel disproportionately smaller — half the raise often disappears to taxes. Bracket creep is real but limited — only the dollars in the higher bracket are taxed at the higher rate, not your entire income.

Inflation — The Hidden Pay Cut

A 3% nominal raise during 4% inflation is a 1% real pay cut. The 2021–2023 inflation spike turned many 'good' 5% raises into negative real raises because CPI was running 6–8%. Real wage growth in the US has averaged 0.5–1.5% annually since 2000 — meaningfully positive but not nearly as fast as nominal wages suggest. To match inflation, raises need to be at least 2–3% (the Federal Reserve target); for real wage growth, raises need to exceed 3–4%. Annual raises below 3% are likely real pay cuts. Use the calculator's inflation adjustment to see the real raise — it often reframes negotiation expectations.

Beyond the Headline Number — Total Compensation

The headline salary raise often understates total compensation increase. Promotions typically bring: higher 401(k) match (if match is percentage-based and you save more), higher bonus target (often 5–25% of salary), restricted stock or stock options, expanded benefits, and improved retirement contribution limits in defined-benefit plans. A 15% salary raise on $100K with a bumped bonus target (from 10% to 15%) and 1% additional 401(k) match adds: $15K salary + $7.5K bonus + $1.5K match = $24K total comp increase, not $15K. Always evaluate raises in total compensation terms, especially for promotions and job changes.

Negotiating for Better Outcomes

The single highest-leverage negotiation moment is a new job offer. Within-company merit cycles are constrained by HR budgets and equity considerations; job offers operate within market-rate ranges where you have real leverage. Research market rates for your role and geography using sources like levels.fyi, Glassdoor, and BLS Occupational Employment Statistics. Then negotiate base salary first (it compounds for the rest of your career), then sign-on bonus (one-time), then equity grants (uncertain value), then benefits (smaller dollar value). Most candidates undernegotiate — recruiters report that 60–70% of candidates accept first offers. Counter-offering with specific data on market rates produces a 5–15% improvement on average, with no downside risk in legitimate job-offer situations.

How much of my raise will I actually keep?+

Typically 60–70% for middle-income earners (after 30–40% taxes). High earners (>$200K) keep 55–60%. Use marginal rates not average rates because raises are added at the top of your income. State of residence matters — no-tax states (TX, FL, WA) keep 7–10% more than high-tax states (CA, NY).

Does a raise push me into a higher tax bracket?+

Possibly, but only the dollars in the higher bracket face the higher rate, not your entire income. Bracket thresholds for 2026 single: 22% starts at $48,475, 24% at $103,350, 32% at $197,300. A $10K raise that moves you from $95K to $105K is taxed: most at 22%, the last $1,650 at 24%.

What's a real raise vs. nominal raise?+

Nominal raise is the percentage increase in headline salary. Real raise is the increase in purchasing power after adjusting for inflation. Real raise = ((1 + nominal) / (1 + inflation)) − 1. A 4% raise during 3% inflation is a 0.97% real raise. During 6% inflation, that 4% becomes a 1.9% real pay cut.

Should I negotiate raises annually?+

Yes — most companies expect employees to advocate for themselves. Annual review cycles typically deliver 3–5% raises. Documented contributions, market-rate research, and confident asks can push that to 5–10%+. The downside risk is essentially zero in normal circumstances; the upside compounds across the entire career.

When do raises take effect tax-wise?+

Tax withholding adjusts immediately upon the raise. Federal withholding for the new salary level applies to the next paycheck after the raise takes effect. Your annual tax liability is based on total earned for the year.

Is a sign-on bonus better than higher salary?+

Higher salary is almost always better long-term because it compounds with all future raises (which are typically percentage-based). Sign-on bonus is a one-time event. Exception: if you're confident you'll leave the role within 2–3 years, a large sign-on bonus may produce more total compensation.

Pay Raise Calculator

How to Use This Calculator

Enter Current Salary

Enter Raise Amount or Percentage

Select Filing Status and State

Apply Inflation Adjustment

Review Net Take-Home Change

Formula & Methodology

Trust, Methodology & Sources

Key Terms Explained

Real-World Examples

Standard Merit Raise

Promotion-Driven Raise

New-Job Negotiation

What Your Raise Actually Means (After Taxes and Inflation)

The Tax Bite on a Raise

Inflation — The Hidden Pay Cut

Beyond the Headline Number — Total Compensation

Negotiating for Better Outcomes

Frequently Asked Questions

Pay Raise Calculator

How to Use This Calculator

Enter Current Salary

Enter Raise Amount or Percentage

Select Filing Status and State

Apply Inflation Adjustment

Review Net Take-Home Change

Formula & Methodology

Trust, Methodology & Sources

Key Terms Explained

Real-World Examples

What Your Raise Actually Means (After Taxes and Inflation)

The Tax Bite on a Raise

Inflation — The Hidden Pay Cut

Beyond the Headline Number — Total Compensation

Negotiating for Better Outcomes

Frequently Asked Questions

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