A sample pay stub — annotated
Here's a realistic pay stub for a $75,000/year employee in Texas, bi-weekly pay frequency. Every line is explained in the sections below.
Every line explained
Gross Pay
Your total earnings before any taxes or deductions. For salaried employees it's your annual salary divided by the number of pay periods (e.g. $75,000 ÷ 26 = $2,884.62 bi-weekly). For hourly employees it's hours worked × hourly rate. This is the starting point for all tax calculations.
401(k) / Retirement Contribution
Your elected pre-tax retirement contribution. On the sample stub above, 6% of $2,884.62 = $173.08 per paycheck. This amount is deducted from gross pay before federal and state income tax is calculated — reducing your taxable income and your tax bill. Note: 401(k) does not reduce Social Security or Medicare wages.
Health Insurance Premium
Your share of employer-sponsored health insurance premiums. If set up under a Section 125 cafeteria plan (which most employer plans are), these are pre-tax — reducing both your income tax and your FICA taxes. The amount varies widely by employer and plan.
Federal Income Tax
Withheld based on your gross pay, filing status, W-4 elections, and pre-tax deductions. Your employer uses IRS withholding tables to estimate your annual tax liability and spread it across paychecks. The actual amount you owe is settled when you file your return in April — you get a refund if over-withheld, or owe the difference if under-withheld.
Social Security (6.2%)
Part of FICA tax. Calculated at 6.2% of your gross wages up to the 2026 wage cap of $184,500. Once your YTD wages exceed $184,500, this line drops to $0 for the rest of the year — and your take-home gets a noticeable bump. Your employer pays a matching 6.2%.
Medicare (1.45%)
The other half of FICA. Calculated at 1.45% of all wages with no cap — it never stops. High earners (above $200,000 single / $250,000 MFJ) pay an additional 0.9% Additional Medicare Tax on wages above that threshold. Your employer also pays a matching 1.45%.
State Income Tax
Withheld based on your state's rules. Nine states have no income tax (TX, FL, NV, WA, WY, AK, SD, TN, NH) — so this line is $0.00 if you live there. Other states range from a flat 3–5% to progressive rates as high as 13.3% in California. Some states also have local income taxes (e.g. New York City).
Net Pay (Take-Home)
What lands in your bank account. Gross pay minus all pre-tax deductions and taxes. This is the number that matters day to day. Most Americans take home 65–82% of their gross pay depending on their state, filing status, and deductions.
YTD (Year-To-Date)
The cumulative total of each item since January 1. YTD columns let you track how much you've earned, paid in taxes, and contributed to retirement so far this year. Useful for verifying your W-2 at tax time — the YTD figures on your last pay stub of the year should match the boxes on your W-2.
Common pay stub abbreviations
| Abbreviation | What it means |
|---|---|
| YTD | Year-To-Date — cumulative total since Jan 1 |
| FICA | Federal Insurance Contributions Act — Social Security + Medicare combined |
| FWT / FIT | Federal Withholding Tax / Federal Income Tax |
| SWT / SIT | State Withholding Tax / State Income Tax |
| OASDI | Old Age, Survivors, and Disability Insurance — the official name for Social Security |
| HI / MED | Hospital Insurance / Medicare — the Medicare tax line |
| 401(k) / 403(b) | Pre-tax retirement contribution (403(b) is for non-profits and schools) |
| HSA | Health Savings Account contribution — pre-tax if employer-sponsored |
| FSA | Flexible Spending Account — pre-tax healthcare or dependent care funds |
| EE / ER | Employee / Employer — EE is your share, ER is your employer's share |
| GTL | Group Term Life insurance — employer-paid life insurance above $50K is taxable income |
| Imp Inc | Imputed Income — taxable value of non-cash benefits like company car or excess life insurance |
What to check on every pay stub
Most people never look at their pay stub beyond the net pay amount. But reviewing it takes 2 minutes and can catch costly errors.
1. Verify your gross pay
If you're salaried, your gross should be your annual salary divided by the number of pay periods. If it's wrong, contact payroll — errors here affect every downstream calculation.
2. Check your filing status
Your filing status (Single, MFJ, etc.) drives federal withholding. If it's wrong — e.g. showing Single when you're married — you'll likely over-withhold all year and get a refund instead of keeping the money in your pocket throughout the year.
3. Confirm your 401(k) rate
Verify your contribution percentage matches what you elected. Enrollment errors are more common than you'd think, especially after starting a new job.
4. Watch your SS YTD
Once your YTD Social Security wages approach $184,500 (the 2026 cap), Social Security withholding should stop. If it doesn't stop — or stops too early — alert payroll.
5. Cross-check your last stub with your W-2
Your final pay stub of the year should closely match the boxes on your W-2. Box 1 (federal wages) = gross pay minus pre-tax deductions. Box 4 (SS withheld) = your YTD Social Security. Discrepancies may indicate payroll errors.
Frequently asked questions
Why is my federal taxable income lower than my gross pay?
Pre-tax deductions — 401(k) contributions, health insurance premiums under a Section 125 plan, HSA contributions — are subtracted from gross pay before federal income tax is calculated. So your federal taxable wages will be lower than your gross wages by the amount of those deductions.
Why are my Social Security wages different from my federal wages?
401(k) contributions reduce federal taxable wages but do not reduce Social Security and Medicare wages. However, certain Section 125 health insurance premiums do reduce Social Security wages. This is why you'll sometimes see different numbers in the "Federal Wages" and "SS Wages" boxes on your W-2.
My pay stub shows a negative number — what does that mean?
Deductions are typically shown as negative numbers (or with a minus sign). Occasionally an employer might show corrections or overpayment recoveries as negatives in the earnings section. If you see something unexpected, ask payroll for clarification.
What if my pay stub has an error?
Contact your payroll or HR department immediately. Most errors can be corrected in the next pay cycle. Keep a copy of the incorrect stub for your records. For tax errors (wrong filing status, wrong withholding amount), you can also update your W-4 at any time — changes take effect in the next payroll cycle.