Learn how paystubs actually work
Plain-English guides to every acronym, tax, and box on a US pay stub — updated for 2026.
Paystub basics
What is a pay stub?
A pay stub is a document that itemizes an employee's earnings and deductions for a single pay period. It shows gross wages, taxes withheld, other deductions, and net pay — the amount actually deposited or paid to the worker. Employers issue it either on paper or electronically alongside every paycheck.
What does YTD mean on a paystub?
YTD stands for "year-to-date". On a pay stub, every earnings and deduction line has a YTD column that shows the running total from January 1 of the current calendar year through the current pay date. It lets you see cumulative gross pay, taxes withheld, 401(k) contributions, and net pay for the year so far.
Gross pay vs net pay
Gross pay is the total amount you earn before any taxes or deductions. Net pay — often called take-home pay — is what actually lands in your bank account after federal tax, Social Security, Medicare, state tax, and any benefit deductions come out. On a US paystub, net pay is typically 65–80% of gross depending on tax bracket, state, and elected benefits.
How to read a US paystub
A US paystub is read top to bottom in four sections: (1) the header identifies employer, employee, pay period, and pay date; (2) earnings show hours × rate for regular, overtime, and other pay; (3) deductions list pre-tax benefits, taxes, and post-tax items; (4) totals show current and year-to-date gross, taxes, and net pay.
Taxes
What is FICA tax?
FICA — the Federal Insurance Contributions Act — is a US payroll tax that funds Social Security and Medicare. Employees pay 6.2% of wages (up to $176,100 in 2025) for Social Security and 1.45% for Medicare, for a total of 7.65%. Employers pay a matching 7.65%. Self-employed workers pay both halves through SECA at 15.3%.
What is OASDI on my paycheck?
OASDI — Old Age, Survivors, and Disability Insurance — is the formal name for the Social Security tax portion of FICA. Employees pay 6.2% of wages up to $176,100 (2025 wage base). It funds retirement, disability, and survivor benefits under the Social Security Administration.
Federal income tax withholding explained
Federal income tax withholding is the amount your employer sends to the IRS on your behalf from each paycheck. The amount is calculated using your W-4 elections, filing status, and pay frequency against the IRS withholding tables in Publication 15-T. It is a prepayment toward your annual income tax bill — not a fixed rate.
Forms
What is a W-2 form?
IRS Form W-2, Wage and Tax Statement, is the annual summary an employer sends every employee and the IRS reporting total wages paid and total taxes withheld during the calendar year. Employers must send it by January 31 of the following year. It is the primary document you use to file your federal and state income tax returns.
What is a 1099 form?
Form 1099 is a family of IRS information returns used to report income other than wages paid to an employee. The most common variant, 1099-NEC (Nonemployee Compensation), is issued to independent contractors, freelancers, and gig workers who received $600 or more from a single payer during the year. Recipients use it to file their own income and self-employment taxes.