Every line on your pay stub explained — what it means, how it’s calculated, and what to verify each payday.
Your pay stub tells the story of how your employer’s number — your salary or hourly rate — shrinks into the deposit that hits your bank account. That gap is not a mistake. It’s taxes being withheld and deductions you elected, all itemized line by line.
For most workers, net pay is 65–80% of gross pay. The exact percentage depends on your income, the state you live in, your filing status, and whether you contribute to a 401(k) or pay health insurance premiums through work.
Here is a real example of what a pay stub looks like for someone earning $60,000 per year in a state with a 4.4% flat income tax, paid biweekly:
That $2,307.69 paycheck becomes $1,618.77 in take-home — about 70 cents of every gross dollar. Now let’s go through each line and explain exactly what it is and how it is calculated.
Your total earnings before anything is subtracted. For salaried workers, this is your annual salary divided by the number of pay periods per year — 26 for biweekly, 24 for semi-monthly, 52 for weekly. For hourly workers, it is hours worked multiplied by your hourly rate, plus any overtime premium. Gross pay is the starting point for every tax and deduction calculation below.
An estimate of what you owe the IRS for this pay period, calculated using the IRS withholding tables and the filing status you provided on your W-4. This is not your final tax bill — it is a prepayment. If too much is withheld over the year, you get a refund when you file. If too little is withheld, you owe the difference. The calculation uses progressive brackets: for 2026, income is taxed at 10%, 12%, 22%, 24%, 32%, 35%, or 37% depending on your total income and filing status.
Social Security is exactly 6.2% of your gross wages, withheld every paycheck until you hit the annual wage base — $184,500 for 2026. After that, no more Social Security is withheld for the rest of the year. Your employer pays a matching 6.2%, so the full 12.4% goes to the Social Security Administration even though only your half appears on your stub. Many pay stubs label this line OASDI, short for Old Age, Survivors, and Disability Insurance.
Medicare is 1.45% of all wages with no annual cap. Unlike Social Security, it never stops for high earners — it applies to every dollar you earn. Workers earning above $200,000 (single) or $250,000 (married filing jointly) also pay an additional 0.9% Additional Medicare Tax on wages above those thresholds. Your employer matches the base 1.45%. Pay stubs sometimes label this line HI, short for Hospital Insurance.
If you live in one of the 41 states with a state income tax, this line shows the amount withheld. Rates range from 2.5% flat in Arizona to a top marginal rate above 13% in California. Nine states — Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming — have no state income tax, so this line will not appear on pay stubs for workers in those states. Some cities and counties, including New York City and Philadelphia, add local income taxes on top of state tax.
If you contribute to a workplace retirement plan, this deduction is taken before income taxes are calculated — one of the most valuable tax advantages available to employees. A $200 pre-tax 401(k) contribution does not reduce your take-home by $200. For someone in the 22% federal bracket plus a 4% state rate, it only costs about $148 in take-home pay because you save $52 in taxes on that $200. The 2026 contribution limit is $23,500 ($31,000 if you are 50 or older).
Employer-sponsored insurance premiums are typically deducted pre-tax through a Section 125 cafeteria plan, reducing your taxable income the same way a 401(k) contribution does. Your stub shows only your share of the premium — your employer covers a portion as well. If your premium amount changes after open enrollment, expect it to appear in your check one to two pay periods later as payroll processes the change.
Contributions to a Health Savings Account (HSA) or Flexible Spending Account (FSA) are pre-tax deductions that reduce both your income taxes and your FICA taxes — a double benefit that standard 401(k) contributions do not provide. HSA balances roll over year to year and the account is yours to keep even if you change jobs. FSA balances generally do not roll over, so watch your YTD column toward year-end to avoid forfeiting unspent funds.
The bottom line: what you actually receive. Net pay equals gross pay minus all taxes and all deductions. This is the amount deposited into your bank account or printed on your check. If your net pay is ever different than expected, work backward through the deduction lines — the culprit is almost always a deduction change from a benefits update or a tax table change at the start of a new year.
One of the most important distinctions on a pay stub is whether a deduction is pre-tax or post-tax. Both take money out of your paycheck, but they have very different effects on your tax bill.
Pre-tax deductions — traditional 401(k), health insurance premiums, HSA, FSA, dental, vision — come out of gross pay before any income taxes are calculated. This means you pay taxes on a smaller income. A worker in the 22% federal bracket and 5% state bracket who contributes $500/month to a traditional 401(k) reduces their taxable income by $6,000 per year and saves roughly $1,620 in taxes annually. The $500 only costs about $365 per month in take-home pay.
Post-tax deductions — Roth 401(k) contributions, supplemental life insurance, some disability plans, wage garnishments — come out after taxes are calculated. You get no immediate tax reduction, but Roth contributions grow and withdraw tax-free in retirement, which can be more valuable for younger workers who expect to be in a higher bracket later.
Most pay stubs display two columns next to each line item: the current period amount and the Year-to-Date (YTD) total. YTD is the running sum since January 1 of the current calendar year.
The YTD column matters most for three situations:
Most employees glance at net pay and move on. A 30-second review of four numbers catches the errors that can cost hundreds of dollars over the course of a year:
Now that you understand every line, run your own numbers. Enter your salary, state, and filing status to see a full breakdown in seconds.
Calculate My Take-Home Pay →Gross pay is your total earnings before any taxes or deductions. For a $60,000 salary paid biweekly, gross pay is $2,307.69 per check ($60,000 ÷ 26). For hourly workers, it is hours worked times your hourly rate, plus any overtime premium.
Gross pay is what you earn. Net pay is what you receive after taxes and deductions are subtracted. For most US workers, net pay is 65–80% of gross pay. The gap includes federal income tax, Social Security (6.2%), Medicare (1.45%), state income tax where applicable, and voluntary deductions like 401(k) contributions and health insurance premiums.
It is an estimate of the income tax you owe the IRS for the period, calculated from your W-4 and the IRS withholding tables. This is a prepayment — your actual tax liability is calculated when you file your return. If withholding was too high, you get a refund. If too low, you owe the difference.
OASDI stands for Old Age, Survivors, and Disability Insurance — the formal name for Social Security tax. The rate is 6.2% of gross wages up to $184,500 in 2026. Your employer pays a matching 6.2%, though only your half appears on your stub.
Pre-tax deductions are subtracted from gross pay before income taxes are calculated, reducing your taxable income. Common examples: traditional 401(k) contributions, health and dental insurance premiums, HSA contributions, and FSA contributions. A $200 pre-tax contribution typically only costs $140–$165 in take-home pay because of the tax savings.
YTD stands for Year-to-Date. It shows the running total of each line item since January 1 of the current year. Use it to track 401(k) contributions against the annual limit and to verify Social Security withholding stops once your gross earnings cross $184,500.
The most common causes: a deduction changed (new benefits election, 401(k) rate update, open enrollment taking effect), a federal or state tax table changed at the start of the year, or your W-4 filing status does not match your current situation. Work backward through each line item on your stub to find the discrepancy.
Verify four things: gross pay matches your salary divided by pay periods (or hours times rate), Social Security is exactly 6.2% of gross and stops once YTD wages exceed $184,500, pre-tax deductions match your benefits enrollment, and your W-4 reflects your current filing status and life situation.