How to read a pay stub

1. Your details and the pay period

Confirm your name, the employer, and the pay period dates. If you are paid every two weeks, each stub should cover a different, non-overlapping two-week period.

2. Earnings

Each earning has its own line, usually with columns for hours, rate, the amount this period, and the year-to-date amount. Check hours against your own record and the rate against your agreed pay. The total of this section is gross pay.

3. Taxes withheld

Federal income tax is withheld based on the Form W-4 you gave your employer. Social Security and Medicare are withheld from most wages; the IRS notes the employer pays a matching amount of each, which does not appear as a deduction from your pay. State and local income taxes appear only where they apply.

4. Other deductions

Benefits and other amounts taken out: health, dental or vision premiums, retirement contributions, and any garnishment. Some are taken before tax and reduce taxable wages; others are taken after.

5. Net pay

Gross pay minus everything above, plus any reimbursements. It should equal the amount of your paycheck or direct deposit.

6. Year to date

The YTD column is the running total since January 1. It is the quickest way to see what you have earned and paid in tax so far this year, and it should reach the figures on your Form W-2 by the last pay stub of the year.

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