A pay stub looks crowded, but almost every line falls into one of four groups: what you earned, what was taken out before tax, what was taken out for tax, and what was taken out after tax. What is left is your net pay, the amount deposited in your bank account.
1. Gross pay
Gross pay is your total earnings for the pay period before anything is removed. It includes regular wages, overtime, bonuses and commissions. For a salaried employee it is the annual salary divided by the number of pay periods. For an hourly worker it is the hours worked times the hourly rate.
2. Pre-tax deductions
These come out of your pay before income tax is figured, so they lower the wages that are taxed. Common ones are traditional 401(k) contributions, employer health insurance premiums, health savings account (HSA) contributions and flexible spending accounts. Which taxes they reduce differs: a traditional 401(k) deferral reduces income tax wages but not Social Security and Medicare wages, while health premiums paid through a cafeteria plan and payroll HSA contributions usually reduce both.
3. Taxes
- Federal income tax withholding. Your employer estimates your annual tax from your Form W-4 and the IRS withholding tables, then withholds a share from each paycheck. It is an estimate, not your final bill.
- Social Security (OASDI). 6.2% of wages up to the 2026 wage base of $184,500. Your employer pays a matching 6.2% on top.
- Medicare. 1.45% of all wages, with no cap. Employers withhold an extra 0.9% on wages above $200,000.
- State income tax. Depends on where you live and work. Nine states do not tax wages. See your state's rules.
- State payroll programs. Some states take small amounts for disability insurance or paid family leave, for example California SDI or the New York paid family leave contribution.
- Local taxes. Certain cities and counties charge their own income tax, such as parts of Ohio and Pennsylvania.
4. Post-tax deductions
These come out of net pay after taxes are calculated: Roth 401(k) contributions, union dues, some insurance, garnishments and charitable payroll giving. They do not lower your taxes.
5. Net pay and year-to-date
Net pay is gross pay minus everything above. Most stubs also show year-to-date (YTD) totals, which add up each line since January. YTD figures are useful for checking that Social Security stops once you pass the wage base and for matching your final stub against your W-2.
A worked example
Here is one biweekly stub for a single employee earning $65,000 a year, contributing 5% to a traditional 401(k), in a state with no income tax (such as Texas), using 2026 rules:
| Item | Per paycheck |
|---|---|
| Gross pay | $2,500.00 |
| Pre-tax 401(k) (5%) | −$125.00 |
| Federal income tax | −$201.15 |
| Social Security (6.2%) | −$155.00 |
| Medicare (1.45%) | −$36.25 |
| Net pay | $1,982.60 |
Notice that the 401(k) money did not disappear: it moved into your retirement account, and it also lowered the federal income tax withheld. Only the Federal line changes if you adjust your Form W-4; the Social Security and Medicare lines depend on your wages.
Check your stub against your W-2
At year end your W-2 repeats these totals in boxes. Box 1 is wages subject to federal income tax (after pre-tax deductions), box 3 is Social Security wages, box 5 is Medicare wages, and box 12 code D shows traditional 401(k) deferrals. If your stub's YTD figures do not match, ask payroll.
Try the take-home pay calculator to see your own numbers, or pick your state from the state list.