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Your Paycheck

Your paycheck is the money your employer pays you for doing your job. To get the money, you cash your paycheck at a business.

You can deposit your paycheck in your bank or credit union account. Or you can cash your paycheck with a bank, credit union, or another business.

What is direct deposit?

Direct deposit is when your employer puts your paycheck into your bank or credit union account. Many employers offer direct deposit.

What is a pay stub?

When you get a paycheck, you also get a pay stub. A pay stub is sometimes called an earnings statement.

Your pay stub tells you:

  • how much money you earned
  • the time, or pay period, you are getting paid for
  • what taxes and other money have been taken out, or deducted, from your pay

What is gross pay?

Gross pay is all the money you earned at your job. But you do not keep all of your gross pay. Your employer will take money out of your gross pay for taxes and benefits.

What is take-home pay?

Take-home pay, also called net pay, is the money you get in your paycheck. Your employer takes money from your

gross pay for taxes and benefits. The money left in your paycheck is your take-home pay.

What is FICA?

FICA stands for Federal Insurance Contributions Act. FICA is money the federal government takes out of your paycheck. This money is used for the government’s Social Security and Medicare programs.

What are tax withholdings?

The law says your employer must take money out of your paycheck for taxes. You can choose how much money to withhold from — or take out of — your paycheck. When you have a big change in your life, you might owe more or less money in taxes than before. To have the right amount of money come out of your paycheck for taxes, you change your withholdings.

What is a W-2?

A W-2 is a form your employer sends you at the end of every year. A W-2 says how much money you earned during the year. Your W-2 also says how much money was taken out of your paycheck for taxes during the year. You use your W-2 when you file your taxes with the Internal Revenue Service (IRS) and some states.

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Category: Paycheck

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