How to Read a Pay Stub: Earnings, Deductions and YTD

To read a pay stub, work from top to bottom: confirm who was paid and for which dates, then check each earnings line, then each deduction, then net pay and the year-to-date totals. The goal is to understand how the payment was calculated and whether each number matches the records behind it.

The sequence matters. A stub with perfect math and the wrong pay period can still cause confusion, so the details at the top come first. This guide walks through each section, adds a table of the abbreviations payroll systems print, covers tips and other earnings labels that trip readers up, and finishes with three sample stubs read line by line.

The five sections almost every pay stub has

Layouts differ between payroll providers, but the same building blocks show up nearly every time. Once you can find them, an unfamiliar stub stops looking unfamiliar.

Some stubs add a memo area with employer contributions, paid time off balances or a check number. Those are useful context, but they do not change what was paid.

Start with the basic details

The top of a pay stub usually identifies the employer or business and the worker. It may also show an employee ID, department, address, pay frequency, or a check or advice number.

Check these details first because they are easy to overlook. A pay stub with correct totals but the wrong name, business, or date can still create confusion.

When reading the header, ask:

• Is the employee's name spelled the way it appears on their tax forms?
• Is the employer's legal or business name shown, not just a brand?
• Is any Social Security number masked to the last four digits?
• Does the pay frequency (weekly, biweekly, semimonthly or monthly) match what the employee expects?

Two more header details are worth knowing. In many states, including California and New York, listing the complete legal business name and registered address on the wage statement is an explicit statutory requirement. And some systems print the marital status and withholding preferences selected on federal Form W-4 (such as Single, Married Filing Jointly, or Head of Household), which governs automated withholding tables.

Review the pay period and the pay date

The pay period shows the dates covered by the payment. The pay date shows when the payment was issued. These dates are related, but not always identical.

For example, a pay period might run from June 1 to June 14, while the pay date is June 18. If you are comparing the stub to bank deposits, use the pay date. If you are comparing it to timesheets, use the period dates. The difference between the two, and why it affects which year a payment counts in, is explained in pay date vs period end date.

A quick sanity check: count the days in the period. Fourteen days suggests biweekly pay, roughly 15 or 16 suggests semimonthly, and a full calendar month suggests monthly. A 14-day period on a stub labeled semimonthly is worth a second look.

Understand the earnings section

Earnings show what was paid before deductions. They may include regular wages, overtime, salary, bonus, commission, tips, or other earning lines. Each line normally has a description, a rate, hours or units, a current amount and a YTD amount.

When reading this section, ask:

• Does the rate match the offer letter or the latest pay change notice?
• Do the hours match the timesheet for these exact dates?
• Does hours multiplied by rate equal the current amount on each line?
• Are bonus or commission lines labeled clearly?
• Does gross pay equal the sum of the earning lines?

Two reference points help here. A standard full-time biweekly period typically shows 80 hours. And under the federal Fair Labor Standards Act (FLSA), non-exempt employees must receive overtime pay for hours worked over 40 in a single workweek at a rate not less than one and one-half times their regular rate, so overtime hours sit on their own line.

If the stub is for a salary payment, the earnings section may be simpler, often a single line with no hours. Still, the amount should match the pay period: an annual salary divided by the number of pay dates in the year.

Tips, commissions and other earnings labels

Beyond regular and overtime pay, earnings sections use short labels that are easy to misread. The table groups the common ones by what to verify.

Tips have tax rules of their own. IRS Publication 15 (2026) says tips of $20 or more in a month that an employee reports are subject to Social Security and Medicare, and that tips are treated as supplemental wages for income tax withholding. Under IRS Revenue Ruling 2012-18, a service charge the customer is required to pay is not a tip but non-tip wages, which is why it belongs on its own line.

A layout detail confuses many tipped workers. Because the employee already has cash tips in hand, many payroll systems add them to gross pay so the taxes are figured, then subtract the same amount further down so the deposit does not pay them out twice. From 2026, the IRS instructions for Form W-2 also add Box 12 code TP for cash tips reported to the employer, so the YTD tips line on the final stub of the year becomes a useful reference.

Bonuses are often paid on a separate check with different withholding; how bonus pay appears covers both withholding methods. Mileage and expense repayments can look like earnings but are not wages, as explained in reimbursements vs earnings.

Understand the deductions section

Deductions explain why net pay is lower than gross pay. They usually split into taxes, such as federal and state income tax withholding, Social Security, Medicare and local tax, and other items such as benefit premiums, retirement contributions and garnishments.

When reading this section, ask:

• Does every deduction have a name you recognize, or only a code?
• Is each line an amount you expected from an enrollment, a W-4 or an order?
• Do taxable wage figures, if shown, sit below gross pay by the amount of pre-tax deductions?
• Did any line appear, disappear or change size since the last stub?

Because deductions are payroll and tax related, review them carefully rather than assuming they are right. The full breakdown of families, codes and limits is in paystub deductions explained.

Federal income tax (FIT)

Federal income tax withholding is calculated based on taxable wages, the pay frequency, and the information you provided on Form W-4. The IRS publishes percentage method and wage bracket tables in IRS Publication 15 (Employer's Tax Guide) to determine how much federal tax payroll software must withhold from each check. This figure is not a final tax bill; it is an installment applied against your annual tax liability when you file Form 1040.

Social Security and Medicare (FICA)

The Federal Insurance Contributions Act mandates two separate withholdings from an employee's wages, matched dollar-for-dollar by the employer:

1. Social Security (OASDI): The employee withholding rate is 6.2% of covered wages, capped at the annual federal wage base limit ($184,500 for the 2026 calendar year, up from $176,100 in 2025; the Social Security Administration adjusts it each year). Once an employee's cumulative year-to-date wages cross the statutory cap, the 6.2% withholding stops for the remainder of the calendar year.
2. Medicare: The base employee Medicare withholding rate is 1.45% on all covered wages, with no annual wage limit. Under the Affordable Care Act, employers must also withhold an Additional Medicare Tax of 0.9% on compensation paid to an individual in excess of $200,000 in a calendar year, regardless of filing status.

State and local taxes

Depending on the employee's work location and residence, additional state and municipal taxes may apply:

• State income tax (SIT): Withheld based on state-level withholding certificates (such as Form VA-4 in Virginia, DE-4 in California, or IT-2104 in New York). Nine US states have no personal wage income tax, while others use flat or graduated tax brackets.
• State disability and family leave: States such as California (SDI), New Jersey (FLI/DI), New York (PFL), and Washington collect small percentage assessments to fund state-administered disability or paid leave programs.
• Local and city taxes: Municipalities such as New York City, Philadelphia, and various districts across Ohio and Pennsylvania levy local earned income taxes directly on wages.

Pre-tax and post-tax deductions

Beyond statutory taxes, pay stubs frequently display voluntary withholdings elected by the worker. The placement of these deductions determines whether they reduce your income tax for the pay period, which is the contrast explained in pre-tax versus post-tax deductions.

• Pre-tax deductions: Subtracted from gross pay before income taxes are calculated. Typical examples include contributions to an employer-sponsored traditional 401(k) or 403(b) retirement plan, medical and dental insurance premiums paid under an IRS Section 125 cafeteria plan, Flexible Spending Accounts (FSA), and Health Savings Accounts (HSA). These deductions lower your reported taxable wages for federal and most state income taxes.
• Post-tax deductions: Subtracted after all mandatory taxes have been assessed against taxable pay. Examples include Roth 401(k) contributions, charitable donations made through payroll giving, union dues, voluntary life insurance, and court-ordered wage garnishments or child support orders.

Common pay stub abbreviations

Payroll systems shorten nearly everything to fit narrow columns. These codes appear across many providers, though no standard forces anyone to use them.

If a code is not on this list, the payroll portal often has a legend, and payroll can confirm what it stands for.

Gross pay vs net pay

Gross pay is the amount before deductions. Net pay is the amount after deductions. Net pay is often the deposit amount or take-home amount.

A quick check is to compare gross pay minus total deductions against net pay. If a reimbursement is present, add it back after deductions. If the numbers still do not connect, review each earning and deduction line. The relationship between the two figures, including salary math per pay frequency, is covered in gross pay vs net pay.

Written as a formula:

Net Pay = Gross Earnings - Statutory Taxes - Voluntary Deductions

Below the net pay figure, the stub usually shows how the money was delivered. A direct deposit breakdown lists masked bank account numbers (for example, Checking *4412) and the amount sent to each; many employees split paychecks across accounts, such as directing 80% to checking and 20% to savings. If pay went out by physical check, this area shows the check number and check date instead. Comparing the printed net pay against the deposit credited to your bank account confirms that the payment matched the statement.

Related: Can You File Taxes With Your Last Pay Stub? Form 4852 Explained

What YTD means

YTD means year to date. It shows cumulative totals for the year so far. A pay stub may show YTD gross pay, YTD deductions line by line, and YTD net pay.

Each YTD figure should equal the previous stub's YTD plus this stub's current amount. On most stubs the running total starts over with the first pay date of the calendar year. YTD totals are useful for tracking progress over time, but they should be based on prior records. For a deeper explanation, review what YTD means on a paystub.

Three YTD lines are worth watching through the year:

• YTD gross pay: The sum of all earnings accumulated to date. Useful for personal budgeting, loan applications, and verifying annual salary milestones.
• YTD tax withholdings: The running sum of federal, state, and FICA taxes deducted. At the end of December, your final YTD tax figures should match the numbers printed on Form W-2.
• YTD benefit balances: Cumulative tracking of your personal contributions to retirement accounts and health savings plans, so you stay under annual IRS contribution limits.

Reading the memo section: employer amounts and balances

Below or beside the totals, many stubs print information that does not change this paycheck. Employer-paid amounts, such as an ER 401(k) match, ER medical or ER Medicare, show what the job costs the employer beyond gross pay. Leave balances show hours of paid time off or sick time accrued, used and remaining. Direct deposit details list which accounts received the net pay and how much went to each.

Read these items for context rather than for the math. If an employer amount appears inside total deductions, or a leave balance drops by more hours than the earnings section paid out, that is worth raising with payroll.

Reading a salaried stub

A salaried stub is shorter, but it has its own checks. Divide the annual salary by the number of pay dates: a $78,000 salary paid semimonthly should show $3,250.00 gross per check, because $78,000 ÷ 24 = $3,250.00. The hours column may show 86.67, which is 2,080 annual hours divided by 24, purely for reference.

Exempt salaried employees normally have no overtime line. When a salaried stub shows a lower regular amount than usual, look for an unpaid leave line, a start or end date inside the period, or a note about a salary change. Bonus and commission lines, if any, still sit below the salary line and still add to gross pay.

Reading a sample hourly stub line by line

Illustrative example (made-up figures): an hourly employee is paid biweekly at $21.00 an hour, works 80 regular hours and 3 overtime hours at $31.50, and defers 4% of gross pay to a traditional 401(k). The federal and state income tax amounts are assumptions, not IRS or state table results.

Reading it takes five checks:

1. Earnings: $1,680.00 + $94.50 = $1,774.50, which matches gross pay.
2. Deductions: $70.98 + $112.00 + $110.02 + $25.73 + $48.00 = $366.73.
3. Net pay: $1,774.50 − $366.73 = $1,407.77.
4. Tax bases: Social Security and Medicare apply to the full $1,774.50, because a traditional 401(k) deferral still counts for those taxes, while federal taxable wages would be $1,774.50 − $70.98 = $1,703.52.
5. YTD: with 18 identical stubs, YTD gross is 18 × $1,774.50 = $31,941.00 and YTD net is 18 × $1,407.77 = $25,339.86.

Reading a stub with reported tips

Illustrative example (made-up figures): a restaurant server works 64 regular hours at $12.00 and 4 overtime hours at $18.00 in one workweek of a biweekly period. They report $310.00 in cash tips, and the employer pays out $145.00 in card tips. Income tax amounts are assumptions.

Social Security and Medicare are figured on the full $1,295.00, including both kinds of tips: $1,295.00 × 6.2% = $80.29 and $1,295.00 × 1.45% = $18.78. The deductions add up to $536.07 once the $310.00 cash tip offset is included, so net pay is $1,295.00 − $536.07 = $758.93.

Another way to see the same deposit: wages plus card tips are $768.00 + $72.00 + $145.00 = $985.00, and subtracting the four tax lines ($226.07) leaves $758.93. The cash tips were taxed through payroll but never paid out again.

Reading a stub with computed 2026 withholding

The first sample used assumed income tax amounts. This one shows the withholding lines worked out for a real state.

Illustrative example: a single filer in Virginia at $21.00 an hour for 80 regular hours, paid every two weeks, with no pre-tax deductions, one pay period computed with PayStubGo's paystub calculator for the 2026 tax year (an illustration, not tax advice).

Tracing it down line by line:

1. Earnings: 80 hours multiplied by $21.00 yields $1,680.00 in regular pay and gross earnings.
2. FICA taxes: Social Security withholding at 6.2% equals $104.16 ($1,680.00 × 0.062). Medicare withholding at 1.45% equals $24.36 ($1,680.00 × 0.0145).
3. Income taxes: Based on standard 2026 single-filer withholding brackets, federal income tax takes $117.75, while Virginia state income tax withholds $86.70.
4. Net pay: Total deductions of $332.97 ($117.75 + $104.16 + $24.36 + $86.70) are subtracted from $1,680.00 gross pay, leaving net pay of $1,347.03.

If this employee were reviewing their 10th biweekly paycheck of the year, the YTD gross pay column would show $16,800.00 ($1,680.00 × 10), and the cumulative Social Security line would stand at $1,041.60 ($104.16 × 10).

How to spot common issues

Common pay stub issues include wrong pay period dates, mismatched gross and net pay, missing deduction lines, duplicate earnings, and YTD totals that do not match previous records.

Do not assume a pay stub is correct because it looks polished. Review it like a financial record. Focus on the numbers and the dates before you focus on the design.

Signs worth a closer look:

• An earnings line where hours times rate does not equal the amount.
• A YTD figure that went down, or grew by more than this period's amount.
• The same overtime hours appearing on two consecutive stubs.
• A deduction present last period that vanished without a notice.
• Net pay that differs from the bank deposit when there is no split deposit.
• Tips reported on the stub that do not match what the employee reported.

Reading a digital pay stub

Digital pay stubs may look different from printed ones, but the structure is usually similar. You still need to identify the same fields: who was paid, what period was covered, what was earned, what was deducted, and what was paid out.

Portals add two wrinkles. The on-screen view may hide the YTD column or deduction detail behind a tab, and the downloadable PDF may show only summary totals. Save the PDF for each pay date rather than relying on the portal, since access can end when a job does. On a phone, rotate the screen or open the PDF itself, because narrow views often drop the rate and hours columns that the earnings checks depend on.

Who decides what a pay stub must show

No single federal format exists. The Department of Labor explains that the Fair Labor Standards Act requires employers to keep accurate records of hours worked and wages paid but does not require them to give employees pay stubs. Whether a stub or wage statement must be provided, and which items it must list, is mostly set by state law. The state labor department's website lists the requirements for workers in that state.

States fall broadly into three groups:

• Comprehensive itemization states: States such as California, New York, Massachusetts, and Illinois enforce detailed wage statement statutes. Employers must itemize all hourly rates applied, total hours worked, gross wages, net wages, specific deduction categories, inclusive pay period dates, and legal entity details. California Labor Code Section 226, for example, specifies nine distinct items that must appear on every pay stub.
• Basic statement states: States that require employers to provide a statement of pay and deductions, but do not prescribe a layout or specific line-item formatting.
• No-requirement states: A small group of states with no state-level requirement forcing private employers to issue pay stubs, although federal tax and labor recordkeeping laws still compel employers to maintain accurate underlying payroll records.

Why reading first helps before creating a new stub

Understanding how to read a pay stub also makes it easier to create one correctly. Once you know where earnings, deductions, net pay, and YTD totals belong, you are less likely to enter the right number in the wrong place.

That is why preview matters. When you prepare a paystub-style record with PayStubGo's paystub generator, read the preview the same way you would read a stub from an employer: start with dates, compare the totals, and confirm that each section supports the final net pay. The six earnings statement templates arrange these sections differently, so it helps to read the preview of the one you choose before downloading the PDF.

PayStubGo formats the information you provide into a paystub-style PDF; it is not payroll software and does not calculate or verify official figures. When a stub raises a payroll, tax or legal question, the employer's payroll department or a qualified professional is the right place to take it.