what does pay stub mean

As an employer, calculating YTD for your business’ payroll works the same, except you’ll add the employees’ annual wages together. YTD amounts allow employers to estimate the amount of money they will spend on employee payroll expenses during the year. This means you’ll always know how much money you’re taking home. This enables you to plan your monthly and annual budgets with accuracy and confidence.

However, the rules, regulations, and customs surrounding pay stubs differ from country to country – and even state to state. This can introduce a lot of administrative challenges if you’re hiring globally. Although FreshBooks isn’t payroll software, we seamlessly integrate with Gusto which is.

What Are Gross Earnings On A Paycheck?

Fortunately, you can use a pay stub creator to create professional pay stubs for your employees. Most payroll providers will create the pay stub for you when processing your payroll. When using a paid or free payroll tool, you’ll enter in the required information in each area of the pay stub.

  • If you have questions about any of the information listed on your pay stub, be sure to contact your payroll provider.
  • Understanding YTD amounts is an important step in ensuring that the deductions and insurance contributions on a pay stub are accurate.
  • Luckily you can still calculate YTD the same way you would if you had pay stubs.
  • This can introduce a lot of administrative challenges if you’re hiring globally.
  • The pay stub  will help you understand the difference between your gross salary and the take-home salary.
  • Even if providing pay stubs isn’t a legal requirement, it’s still good practice to do so, and many employees will expect to receive one.
  • Pay stubs are written pay statements that show each employee’s paycheck details for each pay period.

The HCSA health care active spending amount is the total amount spent on health care by all active members of a health care plan. Union dues are a type of payroll deduction made to a labor union. The IRS levy on a pay stub is a tax that is imposed on the wages of an individual. This tax is used to fund the operations of the Internal Revenue Service.

Vac – Vacation Pay

But, it does not require that employers share this information with their employees. Another critical use case for paycheck stubs is proof of income for what does pay stub mean loans. Banks and real estate agents often accept paycheck stubs as proof of income, allowing employees to rent and buy property or apply for a loan.

  • COBRA is a continuation of health insurance coverage that is provided by an employer.
  • Your pay stubs may also be requested if you are moving into a new house or renting.
  • For example, if employees request a day off, it’ll automatically show up on their pay slip like magic.
  • Employers in opt-in states must offer paper pay stubs unless employees prefer to receive electronic copies.
  • It’s used when employers give workers paid time off to balance any hours the employees worked beyond their regular schedule.
  • Yes, you might ask the employer to let you pay your taxes and take care of the deductions.
  • If you have any issues about the information on your pay stub, please contact your payroll provider.

Common pay stub deductions include federal and state income tax, as well as Social Security. These federal and state withholdings account for much of the difference between your gross income and net income. There may be other deductions as well, depending on the programs that you sign up for with your employer.

Income Pay Stub Abbreviations

Pay stubs also represent proof of income and employment, which employees use when applying for loans and credits. When onboarding new staff, employers typically walk them through how to log their hours but don’t always take the time to review their pay stubs. Employers should hold on to copies of employee pay stubs or other payroll records for at least four years. Gross wages are the full amount an employer pays before deductions. This pay often includes more than the employee’s regular wages.

This will allow them to see exactly how income taxes and deductions affect their gross earnings and result in their net pay. You can give your employees an electronic (e-paystub) or paper pay stub. If you use payroll software, you may be able to give employees access to their pay stubs online through a portal. Keep a copy of each payroll stub for your employee payroll records. Gross wages are how much money you owe an employee before you take out any taxes and deductions. If an employee has any nontaxable income, you must also include it under gross wages.

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