How to Read a Pay Stub: Every Line Explained (2026)

Your pay stub lists every dollar earned and every dollar withheld, but the labels can be cryptic. Understanding each line lets you verify your withholding is correct, catch errors before they compound across pay periods, and make informed decisions about pre-tax contributions and benefit elections.

Gross Pay

Gross pay is your total earnings before anything is deducted. For a salaried employee earning $75,000 per year paid biweekly, gross pay is $2,885 per paycheck. For hourly workers, gross pay equals hours worked multiplied by the hourly rate plus any overtime premium. Commissions, shift differentials, and bonuses are added to base pay before withholding is calculated. All other deductions flow from this number.

Federal Income Tax

Federal income tax withholding is calculated using the IRS Publication 15-T Percentage Method applied to your annualized wages, based on the filing status and adjustments you entered on your W-4. It is not a flat percentage — it varies by income level and filing status. For a single filer earning $75,000 in Texas, the engine derives $7,670 per year, or $295 per biweekly paycheck. Submitting an updated W-4 — for example, after marriage or a new dependent — will change this line.

Social Security Tax

Social Security is withheld at a flat 6.2% on wages up to the annual wage base of $184,500. On a $75,000 salary, that is $4,650 per year ($179 per paycheck). Once your year-to-date wages reach the wage base, Social Security withholding stops for the remainder of the calendar year — you will see this reflected in your YTD column late in the year if you are a higher earner.

Medicare Tax

Medicare is withheld at 1.45% on all wages with no annual ceiling. On a $75,000 salary, Medicare withholding is $1,088 per year ($42 per paycheck). Workers whose wages exceed $200,000 (single) in a year have an Additional Medicare Tax of 0.9% withheld on earnings above that threshold — this appears as a separate line on the stub once year-to-date wages cross $200,000.

State Income Tax

States with income tax withhold according to their own schedules, typically labeled by the state abbreviation or "State Income Tax." Texas, Florida, Washington, and several other states have no income tax — residents of those states see zero on this line. California, New York, and other progressive-rate states can withhold a substantial share of gross pay. The amount depends on your state withholding certificate (the state equivalent of the W-4) and your wages.

Pre-Tax Deductions

Pre-tax deductions are withheld before federal and state withholding is calculated, reducing your taxable wages. Common examples include traditional 401(k) contributions, health insurance premiums under a Section 125 cafeteria plan, HSA contributions, and flexible spending account (FSA) elections. Because they lower taxable wages, pre-tax deductions reduce federal and state income tax withholding. They do not reduce Social Security or Medicare wages for traditional 401(k) contributions, though Section 125 health premiums do reduce FICA wages.

Post-Tax Deductions

Post-tax deductions come out after withholding has been calculated. They reduce your net paycheck but have no effect on taxable wages or withholding. Roth 401(k) contributions are the most common post-tax item: you contribute after-tax dollars today so qualified retirement withdrawals may be tax-free. Certain supplemental life insurance premiums and union dues also appear post-tax. Knowing which category each deduction falls into helps you compare their true net cost.

YTD Columns and W-2 Verification

Your final pay stub of the year is a preview of your W-2. YTD federal withholding should match W-2 Box 2. YTD Social Security wages match Box 3; YTD Social Security tax withheld matches Box 4. YTD Medicare wages match Box 5; YTD Medicare tax matches Box 6. If your W-2 arrives and these figures differ from your final stub by more than a few cents, contact your payroll administrator before you file. Catching a discrepancy before filing avoids amended returns.

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Frequently Asked Questions

What is gross pay on a pay stub?

Gross pay is your total earnings before any deductions. For a salaried employee earning $75,000 per year paid biweekly, gross pay is $2,885 per paycheck. Hourly workers calculate gross pay as hours worked multiplied by the hourly rate, plus any overtime premium.

What does YTD mean on a pay stub?

YTD stands for year-to-date. The YTD column shows the cumulative total of each pay or deduction category from January 1 through the current pay period. At year-end, your YTD federal withholding should match Box 2 on your W-2, and YTD Social Security tax should match Box 4. Discrepancies are worth raising with your payroll department before tax-filing season.

Why does my net pay differ from the online calculator result?

Online calculators estimate federal, FICA, and state withholding based on standard inputs. Your actual pay stub also reflects voluntary pre-tax deductions (401k, health insurance premiums, HSA), post-tax deductions, local taxes, and payroll rounding. Enter your specific deductions into the calculator's refine panel to get a closer match.

Do pre-tax 401(k) contributions reduce Social Security tax?

No. Traditional 401(k) elective deferrals do not reduce Social Security or Medicare wages. However, health insurance premiums withheld under a Section 125 cafeteria plan typically do reduce FICA wages. Check your benefits enrollment documents to confirm which deductions are Section 125-qualified.

Figures and methods are based on official-source data encoded in the calculator. Not tax advice. Review the methodology and consult a qualified professional for your situation.