If you’re paid by the hour in New Jersey, understanding your paycheck can feel complicated. Between federal taxes, state deductions, and other withholdings, it’s easy to lose track of how much you actually take home.
This guide explains in plain language how to calculate your net pay in New Jersey as an hourly worker — with examples and the latest 2025 tax rates.
Understanding Your Gross Hourly Pay
Your gross pay is what you earn before any taxes or deductions are taken out.
It’s the starting point for calculating your take-home pay.
Formula:
Hourly Rate × Hours Worked = Gross Pay
Example:
If you earn $20 per hour and work 40 hours in a week:
$20 × 40 = $800 gross pay
If you work overtime, those hours are paid at 1.5 times your regular rate.
For instance, if you work 5 extra hours:
5 × ($20 × 1.5) = $150 overtime pay
Total gross pay for that week = $950
Pre-Tax Deductions
Before your taxes are calculated, some deductions may come out of your gross pay. These pre-tax deductions reduce your taxable income.
Common pre-tax items include:
- Health or dental insurance premiums
- 401(k) or IRA retirement contributions
- Health Savings Account (HSA) deposits
Example: If your total pre-tax deductions are $50, your taxable pay becomes:
$950 – $50 = $900 taxable income
Federal Taxes and FICA (Social Security + Medicare)
Federal taxes are withheld based on your W-4 form — which depends on your filing status and number of dependents.
All workers also pay FICA taxes, which fund Social Security and Medicare:
- Social Security: 6.2%
- Medicare: 1.45%
So, if you earn $900 taxable income:
- Social Security = $55.80
- Medicare = $13.05
Total FICA = $68.85
New Jersey State Taxes and Payroll Deductions
New Jersey has a progressive income tax system, with rates ranging from 1.4% to 10.75%.
Most hourly employees fall between 1.4%–3.5%, depending on income level.
In addition to state income tax, New Jersey has unique payroll deductions that appear on every paycheck:
| Deduction Type | 2025 Rate | What It Funds |
|---|---|---|
| Unemployment Insurance (UI) | 0.3825% | Jobless benefits |
| Temporary Disability (TDI / SDI) | 0.23% | Short-term wage replacement |
| Family Leave Insurance (FLI) | 0.33% | Paid family leave |
| Workforce Development (WDF) | 0.0425% | Job training fund |
For a $900 paycheck, that adds up to about $9–$10 in state program deductions.
To explore these in more detail, you can check the New Jersey paycheck deductions calculator.
Bringing It Together — Net Pay Example
Let’s calculate the net pay for an hourly worker earning $20/hour for 40 hours per week with no overtime.
| Description | Amount |
|---|---|
| Gross Pay | $800 |
| Pre-Tax Deductions | -$50 |
| Federal & FICA Taxes | -$120 |
| NJ State Income Tax | -$25 |
| NJ Payroll Deductions (UI, TDI, FLI, WDF) | -$8 |
| Net Take-Home Pay | $597 |
That means your weekly take-home pay would be about $597, or around $1,194 biweekly.
The Role of Pay Frequency
Your pay frequency affects the size of each paycheck, even if your annual income stays the same.
| Pay Schedule | Pay Periods per Year | Approx. Net Pay (for $20/hr) |
|---|---|---|
| Weekly | 52 | $597 |
| Biweekly | 26 | $1,194 |
| Semi-Monthly | 24 | $1,294 |
| Monthly | 12 | $2,588 |
If you want a more precise breakdown by pay period, use the New Jersey salary paycheck calculator.
What to Look For on Your Pay Stub
Hourly workers in New Jersey should review their pay stub regularly to make sure everything is accurate.
Check for these details:
- Correct hourly rate and hours worked
- Overtime or double-time pay (if applicable)
- NJ deductions labeled as “UI,” “FLI,” or “TDI”
- Benefits or insurance contributions
- Year-to-date (YTD) totals
Verifying your paycheck helps you avoid over-withholding and ensures you’re paid correctly.
FAQs About Calculating Hourly Net Pay in New Jersey
How do I figure out my take-home pay in New Jersey?
Multiply your hourly rate by hours worked, then subtract federal tax, FICA, and New Jersey deductions.
What taxes do hourly workers pay in New Jersey?
Hourly employees pay federal income tax, FICA, New Jersey income tax, and small state program contributions like UI, TDI, and FLI.
Does New Jersey tax overtime pay?
Yes. Overtime earnings are taxed the same as regular income in New Jersey.
Can I increase my net pay?
You can increase take-home pay by contributing to pre-tax benefits like a 401(k) or adjusting your W-4 withholdings.
How can I calculate this more accurately?
Use tools like the New Jersey gross-to-net paycheck calculator to estimate your real take-home pay.
“Use our New Jersey Hourly Paycheck Calculator to find your take-home pay per hour.”
“Estimate deductions using the New Jersey Gross-to-Net Paycheck Calculator.”
“Check the New Jersey Payroll Tax Calculator to see how state and federal taxes affect your hourly income.”
“Learn about NJ Paycheck Deductions including insurance, FICA, and retirement.”
“Understand Overtime Pay in New Jersey and how it changes your net pay.”
“Explore New Jersey Minimum Wage Details to stay updated on hourly wage laws.”
Juanita is the creator behind njpaycheckcalculator.org, dedicated to providing accurate and easy-to-use paycheck calculation tools for New Jersey residents. With a strong focus on clarity and reliability, she helps users understand their paychecks and tax deductions with confidence. Juanita is passionate about simplifying complex financial calculations, empowering users to make informed decisions about their income and budgeting.