A paycheck stub is dense by design — it has to fit a year’s worth of legally-mandated disclosures into a sheet of paper. But the structure is consistent. Every stub starts at gross pay, subtracts deductions in a specific order, and ends at net pay. Understanding that order is most of the work.
Gross pay
The first number on your stub is your gross pay for the period — your hourly rate times hours worked, or your salary divided by your pay-period count. Above your stub’s detail section you’ll usually see two columns: “current” (this period) and “YTD” (year to date).
If you’re salaried at $78,000 a year and paid biweekly, your gross pay should be $78,000 ÷ 26 ≈ $3,000 per period. If you’re hourly, gross is hours × rate, plus overtime for hours above 40 per week (most jurisdictions).
Pre-tax deductions
These come out of gross pay before taxes are calculated. They lower your taxable income — which is why they’re sometimes called “above the line.”
The common ones:
- 401(k) traditional contribution. Money going into your traditional 401(k). Reduces your current-year taxable income; you’ll pay tax when you withdraw in retirement.
- HSA contribution. Health Savings Account, if you have a qualifying high-deductible plan. Triple tax-advantaged: pre-tax in, no tax on growth, no tax out for medical expenses.
- Health insurance premium. Most employers run health insurance pre-tax. Lowers taxable income, also typically lowers FICA — a small but real bonus.
- FSA contribution. Flexible Spending Account, similar to an HSA but use-it-or-lose-it.
- Commuter / parking benefits. If your employer offers them.
Tax withholding
After pre-tax deductions, the remaining amount — your taxable wages — is what tax withholding is calculated against. There are usually three or four withholding lines:
- Federal income tax. Calculated from your W-4 settings, your pay-period taxable wages, and the IRS withholding tables.
- Social Security (OASDI). 6.2% of taxable wages, up to the annual wage base — $184,500 for 2026 (announced by SSA on October 24, 2025).
- Medicare. 1.45% of taxable wages, no cap. Plus an additional 0.9% on wages above $200,000 (single) or $250,000 (married filing jointly) — a statutory threshold that has not been indexed for inflation since 2013.
- State income tax. Varies by state; nine states have none.
- Sometimes local tax — city or county income tax, where it exists.
For a deeper look at how federal tax brackets and withholding interact, our explainer on how taxes actually work walks through the math.
Post-tax deductions
These come out after taxes are calculated. Common examples:
- Roth 401(k) contribution. Already-taxed money going in; tax-free growth and withdrawals.
- Disability or supplemental life insurance premium, if not pre-tax.
- Garnishments. Court-ordered: child support, defaulted student loans, IRS levies. These are deducted last and are non-negotiable.
- Charitable payroll deductions (United Way, etc.).
- Stock purchase plan contributions, depending on the plan.
How to verify it
A few sanity checks worth running on every stub:
| Number | Should equal |
|---|---|
| Gross pay (current) | Annual salary ÷ pay periods (or hours × rate) |
| Social Security withheld YTD | 6.2% of YTD taxable wages, up to the annual cap |
| Medicare withheld YTD | 1.45% of YTD wages (or 2.35% above $200,000) |
| Net pay | Gross − pre-tax deductions − all taxes − post-tax deductions |
| YTD federal withheld | Roughly proportional to YTD taxable wages × your effective rate |
If your withholding looks too high or too low, the fix is to update your W-4 with HR. The IRS publishes a free withholding estimator at irs.gov that takes about 15 minutes and tells you what to put on the form — and our walkthrough on how to fill out a W-4 goes step by step.
Sources & further reading
- 01Topic 751 — Social Security and Medicare Withholding Rates. Internal Revenue Service · 2024
- 02Publication 15-T — Federal Income Tax Withholding Methods. Internal Revenue Service · 2024
- 03Contribution and Benefit Base. Social Security Administration · 2024