Section by section
Gross earnings: where your pay stub starts
The gross earnings section shows your total compensation before any deductions. For salaried workers, this is your annual salary divided by the number of pay periods. For hourly workers, it shows hours worked multiplied by your hourly rate. This section may also include separate line items for overtime pay (at 1.5× your regular rate for hours over 40 per week under the FLSA), shift differentials, holiday pay, bonuses, and commissions.
If you see a line labeled "imputed income," this represents the taxable value of a benefit your employer provides (such as group life insurance above $50,000). It increases your taxable income but is not actually paid to you in cash.
Pre-tax deductions: what reduces your taxable income
Pre-tax deductions are subtracted from your gross pay before taxes are calculated. This means they reduce your taxable income and lower the amount of tax you owe. Common pre-tax deductions include:
- Traditional 401(k) / 403(b) contributions: Reduce federal and state income tax, but do not reduce FICA (Social Security and Medicare).
- Health insurance premiums (Section 125): Reduce federal income tax, state income tax, and FICA — making them the most tax-efficient type of deduction.
- HSA contributions: Reduce all taxes (income and FICA) when made through payroll.
- FSA contributions: Same treatment as HSA — reduce income tax and FICA.
The distinction between which deductions reduce FICA and which only reduce income tax is critical for understanding your take-home pay. See our pre-tax vs. post-tax deductions guide for the full breakdown.
Tax withholdings: the biggest deductions
After pre-tax deductions are subtracted, your employer calculates tax withholdings on the remaining taxable amount. These include:
- Federal income tax: Based on your W-4 selections and IRS withholding tables in Publication 15-T.
- Social Security (OASDI): 6.2% of wages up to the annual wage base. Your employer pays an equal amount.
- Medicare: 1.45% of all wages, plus an additional 0.9% on wages above $200,000 (single). See our FICA explained guide.
- State income tax: Varies by state. Some states have flat rates; others have graduated brackets.
- Local taxes: Some cities and counties levy their own income or payroll taxes (e.g., NYC, Philadelphia, Ohio municipalities).
Post-tax deductions: what comes out after taxes
Post-tax deductions do not reduce your taxable income. They are subtracted after taxes are calculated. Common examples include Roth 401(k) contributions, union dues, wage garnishments, voluntary life insurance premiums, and charitable contributions through payroll. Because these come out after taxes, they do not lower your current tax bill (though Roth contributions provide tax-free withdrawals in retirement).
The YTD column: your running annual total
The year-to-date (YTD) column on your pay stub tracks the cumulative total of each item from January 1 through the current pay period. This is how you verify your W-2 at year-end: the YTD figures on your last pay stub of the year should closely match the amounts reported on your W-2 (Box 1 for wages, Box 2 for federal tax withheld, Boxes 3-6 for Social Security and Medicare wages and tax, Box 12 for 401k contributions, etc.).
If your YTD does not match your W-2, contact payroll before the W-2 filing deadline. Discrepancies can cause issues with your tax return and potential IRS notices.
How to spot pay stub errors
- Check hours and rate. For hourly workers: verify the hours worked match your records and the rate matches your agreed pay.
- Verify salary division. For salaried workers: gross should equal your annual salary divided by the number of pay periods (26 for biweekly, 24 for semi-monthly).
- Compare deductions to elections. Your health insurance, 401(k) percentage, and other elected deductions should match what you signed up for during enrollment.
- Watch Social Security YTD. Once your YTD wages hit the Social Security wage base, Social Security withholding should stop. If it continues, that is an error — and your paycheck should get larger for the rest of the year.
- Cross-check with last year's W-2. If your salary and elections have not changed much, your YTD figures should track similarly to the prior year.
For understanding how your paycheck flows from gross to net, see our payroll mechanics guide and gross to net explained.
Questions
Pay stub FAQ
What is the difference between gross pay and net pay on a pay stub?
Gross pay is your total earnings before any deductions. Net pay is what you actually receive after federal tax, state tax, FICA, and all other deductions are subtracted. The gap between gross and net can be 25% to 40% or more depending on your tax bracket, benefits elections, and state.
What does YTD mean on a pay stub?
YTD stands for year-to-date. It shows the cumulative total of each earnings and deduction category from January 1 through the current pay period. The YTD figures on your last pay stub of the year should match your W-2.
Why is my pay stub different from my W-2?
Small differences can occur due to timing adjustments, imputed income, or pre-tax benefit corrections made late in the year. Large discrepancies should be reported to your payroll department before W-2 filing. Your W-2 is the official tax document the IRS uses.
What should I do if I find an error on my pay stub?
Contact your payroll or HR department immediately. Provide specific details about which line item is wrong and what the correct amount should be. The sooner an error is caught, the easier it is to correct. Errors that carry into your W-2 are harder to fix.
Do all employers have to provide pay stubs?
There is no federal law requiring employers to provide pay stubs. However, most states have their own laws requiring employers to provide a written or electronic earnings statement with each paycheck. Check your state labor department for the specific requirements in your state.
- Sources: IRS Publication 15-T · IRS W-2 instructions · State pay stub laws.
- 🔄 Last updated July 31, 2026 · Tax year 2026
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