To compare job offers fairly, convert each salary into take-home pay: subtract federal, state and local taxes, then the cost of benefits like health insurance, and add back anything the employer contributes, such as a 401(k) match. The offer with the biggest salary isn't always the one that puts the most money in your account.
This guide walks through a step-by-step method, then compares three real-world-style offers in Texas, Oregon and Colorado. To run your own offers side by side, use the paycheck calculator once for each job.
Why gross salary is a poor comparison
A salary figure leaves out several things that change what lands in your bank account:
- State and local income tax. Nine states have no tax on wages, while others take several percent. Some cities and counties add their own tax.
- Health insurance premiums. Your share of the premium can differ by thousands of dollars a year between employers.
- Retirement contributions and matching. A generous 401(k) match is real compensation, even though it never shows up in your paycheck.
- State payroll programs. Some states require employee contributions for disability insurance, paid leave or long-term care.
Federal income tax, Social Security and Medicare follow the same rules everywhere, but they still scale with salary. A $7,000 raise in gross pay doesn't mean $7,000 more in your pocket.
How to compare job offers by take-home pay, step by step
- Collect the details for each offer: base salary, pay frequency, work location (and your home location if they differ), your share of health premiums for the plan you'd choose, and the 401(k) match formula.
- Calculate net pay for each job. Enter the salary, state, your filing status, health premium per paycheck, and the 401(k) percentage you plan to contribute. Use the same contribution rate for every offer so you're comparing like with like.
- Annualize everything. Pay frequency doesn't change yearly take-home much, but comparing per-paycheck amounts across weekly and semimonthly jobs is misleading. Multiply each net paycheck by the number of paychecks per year.
- Add the employer match. Work out the yearly match in dollars based on what you'd contribute.
- Weigh what doesn't fit in a calculator: cost of living, commute costs, paid time off, bonus potential and career growth.
Worked example: three offers in three states
Imagine a single filer weighing three biweekly-paid jobs. In each case they'd contribute 4% of pay to a traditional 401(k).
- Offer A: $85,000 in Texas. Health insurance costs $140 per paycheck. The employer matches 100% of contributions up to 4% of pay.
- Offer B: $92,000 in Oregon. Health insurance costs $65 per paycheck. The employer matches 50% of contributions up to 6% of pay.
- Offer C: $88,000 in Colorado. Health insurance costs $95 per paycheck. The employer matches 100% of contributions up to 3% of pay.
Per-paycheck comparison
| Per biweekly paycheck | A: Texas | B: Oregon | C: Colorado |
|---|---|---|---|
| Gross pay | $3,269.23 | $3,538.46 | $3,384.62 |
| 401(k) at 4% | $130.77 | $141.54 | $135.38 |
| Health insurance | $140.00 | $65.00 | $95.00 |
| Federal income tax | $320.05 | $393.41 | $354.32 |
| Social Security + Medicare | $239.38 | $265.72 | $251.66 |
| State income tax | $0.00 | $259.63 | $111.54 |
| State payroll items | $0.00 | $3.47 (transit tax) | $0.00 |
| Net pay | $2,439.03 | $2,409.69 | $2,436.72 |
All figures are estimates from our calculator.
Full-year comparison
| Per year | A: Texas | B: Oregon | C: Colorado |
|---|---|---|---|
| Salary | $85,000 | $92,000 | $88,000 |
| Take-home pay | $63,415 | $62,652 | $63,355 |
| Your 401(k) contributions | $3,400 | $3,680 | $3,520 |
| Employer match | $3,400 | $1,840 | $2,640 |
| Take-home + retirement savings | $70,215 | $68,172 | $69,515 |
What the numbers show
Offer B pays $7,000 more than Offer A, yet it produces the smallest paycheck and the least retirement money. Oregon's income tax, which reaches 8.75% at just $11,400 of taxable income for single filers, takes about $6,750 a year here. Offer A's higher health premium costs $1,950 more a year than Offer B's, but having no state income tax more than makes up for it.
Offer C lands within about $60 a year of Offer A in take-home pay. The difference comes down to the 401(k) match: Offer A's richer match is worth $760 more a year.
Two caveats on Oregon: our Oregon estimate likely runs high, because Oregon lets you subtract part of your federal income tax and the calculator doesn't apply that. Portland-area residents may also owe Metro and Multnomah County taxes on higher incomes, and Oregon workers contribute to Paid Leave Oregon. Colorado workers similarly contribute to the FAMLI paid leave program, which isn't included above. Check each state's agency for current rates.
Things a paycheck comparison misses
Cost of living
Rent, home prices, utilities and transportation can vary more between cities than taxes do. Once you know each offer's monthly take-home, compare it against realistic housing and commuting costs in that area. Our guide to comparing salaries across cities and states goes deeper on this.
Other taxes
States without an income tax often lean more on sales or property taxes. Those don't come out of your paycheck, but they affect your budget.
Benefits beyond health and retirement
- Paid time off and holidays
- Bonus structure (bonuses are often withheld at a flat 22% federal rate)
- Deductibles and out-of-pocket maximums on the health plan, not just the premium
- HSA or FSA contributions from the employer
- Remote work flexibility, which can also affect which state taxes your income
If you'll live in one state and work in another, the tax picture changes again. See living in one state and working in another for how that's usually handled.
Using take-home pay in salary negotiations
Knowing your take-home numbers gives you a concrete basis for negotiating. If an offer in a high-tax state nets less than your current job, you can show the gap in dollars instead of asking for a vague "bit more." Likewise, if an employer can't move on salary, a lower health premium or a better match may close the gap. Our guide to negotiating salary with take-home pay in mind covers how to frame that conversation.
Frequently Asked Questions
Should I compare offers by monthly or annual take-home?
Annual is the cleanest comparison because it removes differences in pay frequency. Monthly figures are useful afterward for checking each offer against your budget.
Does my filing status affect which offer is better?
It changes the dollar amounts but rarely flips the ranking, since the same filing status applies to every offer. Married couples should compare using their combined household situation.
How do I value a 401(k) match?
Multiply your salary by the matched percentage you'd actually earn. A 100% match up to 4% on $85,000 is $3,400 a year, as long as you contribute at least 4% and meet any vesting requirements.
Is a no-income-tax state always the better deal?
Not always. A higher salary, cheaper benefits or a lower cost of living elsewhere can outweigh the tax savings, so run the full comparison.
Sources
- IRS: Tax inflation adjustments for tax year 2026
- IRS: 401(k) limit increases to $24,500 for 2026
- Tax Foundation: State Individual Income Tax Rates for 2026
- Consumer Financial Protection Bureau
Run the numbers for your state
Written and checked against IRS, Social Security Administration and state tax agency publications for the 2026 tax year. General information, not tax, legal or financial advice. Read our editorial policy, calculation methodology and sources.