Hourly Wage to Annual Salary: Gross Pay Explained

Last updated: August 2026

The Basic Formula

Annual Gross Pay = Hourly Rate × Hours Per Week × Weeks Worked Per Year

Common baseline: 40 hours/week × 52 weeks = 2,080 hours/year. Many people work fewer weeks when accounting for unpaid vacation, holidays, or sick days — for example, 40 hours × 50 weeks = 2,000 hours.

Is This Gross or Take-Home Pay?

Gross pay — before taxes, Social Security, Medicare, health insurance premiums, retirement contributions, and other deductions. Your actual take-home pay will be lower, typically 70-80% of gross depending on your tax bracket, state income tax, and benefit elections.

To estimate take-home pay, you'd need a separate paycheck calculator that factors in federal and state tax withholdings. Our Hourly to Salary Calculator estimates gross pay only.

Overtime Pay

Under the Fair Labor Standards Act (FLSA), non-exempt employees must receive overtime pay at 1.5× their regular rate for hours worked beyond 40 in a workweek. Some employers pay double time (2×) for holidays or hours beyond a higher threshold.

Example: $25/hour, 40 regular hours, 5 overtime hours at 1.5×, 50 weeks/year = ($25 × 40 × 50) + ($25 × 1.5 × 5 × 50) = $50,000 + $9,375 = $59,375 annual gross pay.

Common Conversions (40 hrs × 50 wks)

Source: U.S. Department of Labor — Overtime Pay. For informational purposes only.