Raise & Promotion Calculator
Model your salary increase side-by-side. Enter your current salary and your proposed raise to see how your take-home pay changes and calculate your exact tax drag.
Promotion Details
US Tax Options
Raise Summary
Gross Increase
$15,000
Net Cash Increase
$10,553
| Calculation Level | Current Pay | New Pay | Net Change |
|---|---|---|---|
| Annual Gross Salary | $70,000 | $85,000 | $15,000 |
| Total Taxes & Payroll Levies | $12,127 | $16,575 | $4,448 |
| Net Take-Home Salary | $57,873 | $68,426 | $10,553 |
| Monthly Net Take-Home | $4,823 | $5,702 | $879 |
Understanding Promotion Increases & Tax Drag
What is "Tax Drag"?
Tax drag refers to the portion of your raise or promotion salary increase that is consumed by taxes and payroll deductions. Because your base income already utilizes lower progressive brackets and standard deductions, any incremental increase in salary is taxed at your highest **marginal tax rate**.
For example, if your current salary is $70k and your raise is $15k, that entire extra $15k is subject to your top federal rate (e.g. 22%) plus state tax and FICA (7.65%), meaning your marginal tax rate on the raise is significantly higher than your overall effective tax rate.
Tax Optimization on Raises
When receiving a raise, you can counter the tax drag by allocating a portion of your increase into pre-tax accounts. Increasing your traditional 401(k) contribution percentage or maximizing HSA contributions reduces your taxable federal and state basis, ensuring you shelter more of your new salary from high marginal brackets.