A Complete Guide to Reading Your Pay Stub
Whether you receive a physical check with a detachable stub or view your pay information online, understanding each section of your pay stub empowers you to catch errors, optimize your withholdings, and plan your finances effectively.
Section 1: Employee and Pay Period Information
The top of your pay stub identifies you and the pay period. Look for your name, employee ID, pay period dates (e.g., Jan 1–Jan 14), pay date (when the money hits your account), and pay frequency (weekly, bi-weekly, semi-monthly, or monthly).
Section 2: Earnings (Gross Pay)
This section shows all types of compensation you earned during the period:
- Regular hours/salary — your base compensation. For hourly workers, this shows hours multiplied by rate. For salaried employees, this is your annual salary divided by pay periods.
- Overtime — hours worked beyond 40 per week at 1.5x your regular rate
- Bonuses — any supplemental pay, which may be taxed at the flat 22% federal rate
- Commissions, tips, or PTO payouts — other forms of taxable compensation
Section 3: Tax Withholdings
This is where most people get confused. Here is what each tax line means:
- Federal Income Tax (FIT or Fed W/H) — calculated based on your W-4 elections and the IRS tax brackets. This is the most variable deduction and changes with income and filing status.
- Social Security (OASDI or SS) — always 6.2% of gross wages up to $176,100 (2025). Your employer pays a matching 6.2%.
- Medicare (MED or Med Tax) — always 1.45% of all wages with no cap. An additional 0.9% applies to wages over $200,000.
- State Income Tax (SIT or State W/H) — varies by state. Nine states have no income tax. Others range from 1% to 13.3%.
- Local/City Tax — applicable in certain cities like NYC (up to 3.876%), Philadelphia (3.75%), or Detroit (2.4%).
- SDI/SUI — State Disability Insurance or State Unemployment Insurance deducted in certain states like California, New Jersey, and New York.
Section 4: Deductions
Deductions are split into pre-tax and post-tax categories. Pre-tax deductions (401k, health insurance, HSA) appear before tax calculations, reducing your taxable income. Post-tax deductions (Roth 401k, life insurance, union dues) come out after taxes. Review these carefully each period to ensure they match your elections.
Section 5: Net Pay (Take-Home Pay)
The bottom line: Net Pay = Gross Pay − All Taxes − All Deductions. This is the amount deposited into your bank account or printed on your check. It should match your bank deposit exactly.
Section 6: Year-to-Date (YTD) Totals
Most pay stubs include cumulative totals for the calendar year. These YTD figures are essential for tracking whether you are on pace with your tax liability, monitoring your progress toward the Social Security wage cap ($176,100), and verifying your W-2 at year-end.