How to Read a Pay Stub, Line by Line

Your pay stub (sometimes called an earnings statement) explains how your employer got from what you earned to what landed in your account. Reading it carefully helps you catch errors, understand your taxes, and plan your budget. This guide walks through each common section.

The big picture: gross to net

Every pay stub follows the same basic math:

Gross pay − taxes − deductions = net pay

• Gross pay is the total you earned before anything is taken out.
• Net pay (take-home pay) is what you actually receive.

The difference can be significant, often 20 to 30 percent or more, depending on your taxes and benefit choices. That is why it helps to plan around net pay, not gross.

Section 1: Employee and employer information

At the top you will usually see:

• Your name, and often the last four digits of your Social Security number
• An employee ID
• Your employer’s name and address
• The pay period (the dates you worked) and the pay date (when you were paid)

Check that your name and details are correct.

Section 2: Earnings

This section shows how your gross pay was calculated. Common lines:

Line	What it means
Regular	Your standard hours × your hourly rate, or your salary for the period
Overtime	Extra hours, usually at 1.5 times your regular rate for eligible employees
Holiday, PTO, or sick pay	Paid time off taken during the period
Shift differential	Extra pay for nights, weekends, or other shifts, if offered
Bonus or commission	Variable pay, if part of your role

Each line often shows hours, rate, current amount, and year-to-date (YTD) amount.

Under the federal Fair Labor Standards Act, most hourly employees must receive overtime pay of at least one and a half times their regular rate for hours worked over 40 in a workweek. Some states have additional rules. The Department of Labor’s Wage and Hour Division explains who is covered.

Section 3: Taxes

These are amounts your employer withholds and sends to the government for you.

• Federal income tax. Based on your earnings and the choices on your Form W-4.
• Social Security. Part of FICA. The employee rate is 6.2% of wages up to an annual limit set each year.
• Medicare. Also part of FICA. The employee rate is 1.45% of all wages, with an additional 0.9% on wages above a certain threshold.
• State income tax. Most states have one; a few do not.
• Local tax. Some cities and counties withhold local income taxes.
• State programs. Some states withhold small amounts for disability insurance or paid family leave programs.

If your federal withholding seems too high or too low, you can submit a new W-4 to your employer at any time. The IRS Tax Withholding Estimator can help you decide what to enter.

Section 4: Deductions

Deductions are amounts taken out for benefits or other purposes. They come in two types:

Pre-tax deductions

Taken out before certain taxes are calculated, which lowers your taxable income. Common examples:

• Health, dental, and vision insurance premiums (through many employer plans)
• Traditional 401(k) or 403(b) retirement contributions
• Health savings account (HSA) or flexible spending account (FSA) contributions

Post-tax deductions

Taken out after taxes. Examples:

• Roth 401(k) contributions
• Some life or disability insurance premiums
• Union dues (in some cases)
• Court-ordered wage garnishments

Each deduction should match what you chose during benefit enrollment or what you were notified about. If you see one you don’t recognize, ask HR or payroll.

Section 5: Employer contributions

Some stubs also show what your employer pays on your behalf, such as their share of health insurance premiums or retirement matching. These are not taken from your pay, but they are part of your total compensation.

Section 6: Net pay and payment method

The bottom of the stub shows your net pay and how it was paid: direct deposit (often with the last digits of the account) or a paper check.

Year-to-date totals

YTD columns add up everything since January 1. They are useful for:

• Checking your progress toward annual limits, such as Social Security wages or retirement contributions
• Comparing with your W-2 at tax time
• Showing proof of income when needed

How to check your pay stub

Each pay period, take two minutes to:

1. Confirm the pay period dates
2. Compare hours with your own record of hours worked
3. Check your pay rate matches what you agreed
4. Confirm overtime is calculated correctly, if you worked extra hours
5. Review deductions against your benefit choices
6. Make sure the net pay matches what arrived in your account

Keeping a simple log of your hours (a notes app or calendar works) makes this much easier.

If something is wrong

1. Gather the details: the stub, your record of hours, and your written terms.
2. Ask payroll or HR in writing, by email if possible, and keep a copy.
3. Allow reasonable time for a correction, often on the next paycheck.
4. If the issue is not resolved, your state labor department and the federal Wage and Hour Division accept complaints about unpaid wages. See Workplace rights basics.

Your next steps

1. Find your most recent pay stub and identify each section above.
2. Start a log of your hours worked.
3. Review your W-4 if your withholding seems off.
4. Use the Pay Converter to compare hourly and annual figures before taxes.