Your pay stub may look like a wall of numbers, but each line tells you something important about your compensation. Understanding it helps you verify your employer is withholding the right amounts and spot errors before they compound.
This is your total earnings before any deductions. For salaried employees, it's your annual salary divided by your number of pay periods. For hourly workers, it's your hours worked multiplied by your hourly rate, plus any overtime.
Calculated based on your W-4 filing status and allowances. The more allowances you claim, the less is withheld. If you claim zero, maximum tax is withheld. Your actual tax liability is settled when you file your annual return.
6.2% of gross wages up to the 2025 wage base of $176,100. Once your year-to-date earnings hit that cap, you'll notice Social Security deductions stop — and your net pay increases slightly.
1.45% of all gross wages with no wage cap. High earners (over $200,000) pay an additional 0.9% Additional Medicare Tax. Your employer does not match this additional amount.
Varies significantly by state. Nine states have no income tax at all. California tops out at 13.3% for the highest earners. Your effective state rate depends on your income and filing status in your state.
These come out before taxes are calculated, reducing your taxable income: 401(k) contributions, HSA deposits, FSA elections, and most employer-sponsored health insurance premiums. These deductions save you real money by lowering your tax bill.
Come out after taxes: Roth 401(k) contributions, some life insurance premiums, garnishments, and voluntary after-tax benefits. These don't reduce your tax liability.
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