Your first paystub as a PGY-1 posts in mid-July, and it carries more line items than any check you have received: federal tables you did not choose, payroll taxes you cannot decline, a retirement election you made during a jet-lagged orientation, and a premium for insurance that started before your first shift. This article decodes each line at 2026 numbers, derives the monthly landing figure instead of asserting it, and works through the one quirk — the July 1 start — that builds a refund into your first spring as a physician.
The gross line: $66,986 is the national median, and your contract supersedes it
The AAMC Survey of Resident/Fellow Stipends and Benefits reports a median PGY-1 stipend of $66,986 as of July 1, 2025 — the most recent published vintage as this article is written. Your program may sit meaningfully above or below it: large coastal academic centers commonly pay $75,000 or more, some programs pay under $62,000, and each PGY step typically adds $2,000 to $4,000. Every figure below uses the median; substitute your contract number and the arithmetic holds. At the median, monthly gross is $66,986 ÷ 12 = $5,582.
The paystub grid: three columns, and the one that settles arguments
Before decoding any single line, orient to the grid. Most paystubs show a current column and a year-to-date column, plus a pay period and a pay date — and the distinction matters. A stub dated July 31 may cover work from July 1 through July 15 at programs that pay on a lag, which is why your first deposit can arrive weeks after your first shift and why your last residency check arrives after you have already started fellowship. The year-to-date column is the one that settles arguments: it is what feeds your W-2, it is where you verify that a benefits correction actually posted, and in a job-change year it is the number you carry to your next employer's retirement plan. When any figure below looks wrong on your stub, check whether the current column reflects a partial period before assuming a payroll error.
Federal withholding: the tables annualize each check, then estimate
Payroll does not know your actual tax situation. It takes your W-4 — for most interns, single with no adjustments — assumes this paycheck repeats all year, subtracts the standard deduction baked into the tables, and withholds one-twelfth of the projected annual tax.
Example calculation
Assumptions, stated explicitly: single filer; W-4 with no adjustments; $66,986 paid monthly; 2026 standard deduction of $16,100 and brackets per Rev. Proc. 2025-32.
Taxable income: $66,986 − $16,100 = $50,886 First $12,400 at 10% = $1,240.00 $12,400 to $50,400 at 12% = $4,560.00 $50,400 to $50,886 at 22% = $106.92 Projected annual federal tax: $5,906.92 Monthly federal withholding: ≈ $492
Your marginal federal rate as a PGY-1 barely reaches the 22 percent bracket, but your effective rate is about 8.8 percent — $5,907 on $66,986. That spread is the core argument for Roth contributions in residency: you are prepaying tax at rates you will likely never see again.
FICA: 7.65 percent with no election and no escape
Social Security withholding is 6.2 percent of gross — $346 a month, $4,153 a year — on wages up to the 2026 wage base of $184,500, a ceiling no resident salary approaches. Medicare adds 1.45 percent on every dollar: $81 a month. Together they are $427 a month that no W-4 setting touches. They are not lost; they accrue to your own earnings record, including disability and survivor coverage that exists before you own any private policy.
State tax: $0 to roughly $500 a month, depending on the map
State income tax spans the full range. Train in a state with no income tax and this line reads zero. This article uses Pennsylvania as the illustrative case because its flat 3.07 percent rate keeps the arithmetic transparent: $5,582 × 3.07% = $171 a month. Graduated-rate states can take two to three times that at resident income, and some cities layer a resident wage tax of 1 to 4 percent on top. Check your own state schedule before trusting any national take-home chart, including this one.
The retirement election: capture the match, default to Roth
Two questions decide this line. First, does the plan resident contributions? Ask benefits directly, because the answer varies: some programs match nothing until fellowship, others match from day one. If a match exists, contribute at least enough to collect all of it — a 50-cents-per-dollar match on your first 4 percent turns a $2,679 annual contribution into $4,019 of total savings, a guaranteed 50 percent return no market offers. Second, traditional or Roth? At an 8.8 percent effective and 22 percent , the Roth election usually wins in residency; the calculus flips at attending brackets, as covered in the first attending paycheck. One regional footnote: Pennsylvania taxes elective deferrals on the way in, so pre-tax federal treatment does not carry to every state return.
If the plan offers no match at all, the priority order usually changes: a — with its own $7,500 limit for 2026 under IRS Notice 2025-67 — offers the same tax treatment with unrestricted fund choices, and the employer plan becomes the second stop rather than the first. Either way, the habit matters more than the vehicle at this income. A resident who saves 3 percent from the first paycheck never experiences the money as available, which is precisely the mechanism that survives an attending-level lifestyle reset five years later.
The landing-zone math below assumes a modest 3 percent Roth election: $167 a month.
Health premiums and the quiet lines
Residency health coverage is heavily subsidized but rarely free; employee-share premiums of $100 to $250 a month are typical, and this article assumes $200 as an illustrative midpoint. Dental, vision, and parking can add $20 to $80 more. Premiums usually flow through a Section 125 plan pre-tax, which trims federal withholding slightly; the derivation below ignores that refinement and says so.
Two small lines deserve a second look rather than a reflexive decline. Employer-provided group disability coverage often costs little or nothing, and whether the premium is paid pre-tax or after-tax determines whether a future benefit arrives taxable or tax-free — worth one question to benefits, because a taxable benefit on a resident-sized policy shrinks meaningfully. And a flexible spending account election, if offered, is a use-it-or-lose-it commitment; in intern year, when you cannot yet predict your own copays, the conservative election is small or zero.
Where the check lands: about $4,100 a month, derived
Example calculation
Assumptions, stated explicitly: median $66,986 salary; the federal withholding derived above; illustrative Pennsylvania 3.07 percent state tax; 3 percent Roth election; $200 monthly premium; no local wage tax; Section 125 interaction ignored for clarity.
Monthly gross: $5,582 Federal income tax: − $492 Social Security: − $346 Medicare: − $81 State income tax (illustrative): − $171 Roth 403(b) election (3%): − $167 Health premium (illustrative): − $200 Monthly take-home: $4,125
| Scenario | State line | Monthly take-home |
|---|---|---|
| No state income tax | $0 | $4,296 |
| Flat 3.07 percent (illustrative) | $171 | $4,125 |
| Higher-tax state, 5 percent effective (illustrative) | $279 | $4,017 |
The honest landing zone is roughly $4,000 to $4,300 a month at the median salary. What to do with it — rent ceilings, loan payments, and the order of savings — is the subject of budgeting on a resident salary, and the interactive line-by-line version of this walkthrough lives in paycheck decoded.
The July start builds a refund into your first spring
Withholding tables annualize. Your July through December paychecks are withheld as if you earn $66,986 for the whole calendar year — but you earn half of it, and most interns had little or no W-2 income during fourth year. The tables over-collect, and the excess returns as a refund when you file the following spring.
Example calculation
Assumptions, stated explicitly: start July 1; six monthly paychecks in the first calendar year; no other income; single; standard deduction; no retirement election, to isolate the effect.
July–December gross: $66,986 ÷ 2 = $33,493 Actual taxable income: $33,493 − $16,100 = $17,393 Actual federal tax: $1,240 + 12% × $4,993 = $1,839 Federal tax withheld: $492 × 6 = $2,952 Built-in refund: about $1,113
The same annualization error usually repeats at the state level, so a second, smaller refund often rides along. And the effect is not unique to intern year — it returns at the residency-to-attending transition, when six months of attending paychecks are withheld as if the full attending salary ran all year. The mechanism is identical; the sign-on bonus withheld at a flat 22 percent is what complicates that later version, as the transition-year articles in this series work through.
Important
You can capture that money early with a Form W-4 adjustment for July through December, but the adjustment does not reset itself. Forget it in January and you under-withhold through all of intern spring, converting next year into a balance due. The lower-risk move: leave the W-4 at defaults and assign the roughly $1,100 refund a job in advance — the seed of an emergency fund or the first slice of a Roth IRA contribution.
Quick takeaway
$5,582 gross becomes about $4,125 after federal tax, FICA, an illustrative state tax, a 3 percent Roth election, and a health premium. The number is derived, not asserted — rerun it with your contract salary and your state before building a budget on it.
Common questions
Why is my second paycheck different from my first?
Partial first pay periods, benefits that begin after 30 days, and retroactive premium catch-ups all land in the first two or three checks. Compare check three against the derivation above; the early ones are noise.
Should I claim exempt on my W-4 since I only work half the year?
No. Exempt status requires that you had no tax liability last year and expect none this year. You will owe roughly $1,839 on your half-year of income, so you do not qualify, and claiming exempt anyway trades a built-in refund for a filing-season bill plus potential penalty exposure.
Does moonlighting later in residency change this math?
Substantially. W-2 through a second employer gets its own withholding that assumes a second standard deduction, which under-withholds. Moonlighting paid on a withholds nothing and adds self-employment tax. Either one moves you from refund territory toward quarterly-estimate territory.
Is a $1,100 refund good news?
It is neutral: an interest-free loan you made to the Treasury, returned months later. The July quirk makes it nearly unavoidable in intern year. Treat it as a scheduled windfall with a pre-assigned job, not as free money.
What to do next
- Pull your program's actual PGY-1 stipend from the GME office or your contract and rerun every figure above with your number.
- Verify your W-4 shows your actual filing status with no leftover entries, and do not claim exempt.
- Email benefits one question: does the plan match resident contributions, and at what formula and vesting schedule?
- Set the retirement election to at least the full match, as a Roth election if the plan offers one.
- Assign the built-in first-spring refund a specific job now, in writing.
- When your first full paystub posts, walk it against paycheck decoded line by line and flag anything that deviates by more than a few dollars.
Your paycheck is a stack of estimates sitting on a contract number, and every estimate above is reproducible with your own inputs. The framework works with or without us. This is education, not individualized financial advice.