Gross vs. Net Pay: How to Read Every Line of Your Pay Stub

A line-by-line walkthrough of a U.S. pay stub — earnings, pre-tax deductions, taxes and year-to-date totals — so you can spot errors fast.

Gross pay: the top line

Gross pay is everything you earned in the period before anything is withheld: salary or hourly wages, overtime (at least 1.5× for eligible hourly workers beyond 40 hours a week under federal law), shift differentials, bonuses and commissions. Check the hours and rate first — most paycheck errors start here.

Pre-tax deductions

These come out before income tax is calculated: traditional 401(k) or 403(b) contributions, health/dental/vision premiums under a Section 125 plan, HSA and FSA contributions, and some commuter benefits. Health premiums under Section 125 also reduce FICA wages; 401(k) contributions do not.

Taxes withheld

• Federal income tax — based on your W-4 and IRS withholding tables.
• Social Security — 6.2% of wages up to $184,500 in 2026.
• Medicare — 1.45% of all wages, plus 0.9% above $200,000.
• State and local income tax — varies; nine states have no tax on wages.
• State disability or paid-leave programs in some states.

Post-tax deductions and net pay

After taxes come Roth 401(k) contributions, union dues, wage garnishments and voluntary insurance. What remains is net pay — the deposit. Divide net by gross: most full-time workers keep between 70% and 80%.

Year-to-date (YTD) columns

YTD totals show cumulative earnings and withholding since January. Use them to confirm your 401(k) is on track for the annual limit ($24,500 in 2026), to see if Social Security stopped after the wage base, and to estimate your tax bill before filing.

A 60-second audit checklist

1. Hours and rate correct?
2. Overtime paid at the right multiple?
3. Benefit deductions match your enrollment?
4. 401(k) percentage matches your election?
5. State matches where you live/work?

Found a mistake? Email payroll with the pay date, the line and the expected amount. Then use the take-home calculator to check the corrected figure.

Watch: related explainer

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Educational content only — not tax, legal or financial advice. Sources and assumptions: methodology.