Your pay statement shows various deductions that reduce your gross pay to arrive at your net (take-home) pay. Here’s what they mean.
Common deduction types
Taxes
- Federal Income Tax - Tax withheld for the federal government based on your W-4
- State Income Tax - Tax withheld for your state (if applicable)
- Social Security (FICA) - Contributes to your future Social Security benefits (6.2% of earnings up to the annual limit)
- Medicare - Funds the Medicare health insurance program (1.45% of earnings)
Benefits
- Health Insurance - Your share of medical, dental, or vision insurance premiums
- Life Insurance - Premiums for employer-sponsored life insurance
- Disability Insurance - Short-term or long-term disability coverage
Retirement
- 401(k) / 403(b) - Pre-tax or Roth contributions to your employer retirement plan
- IRA Contributions - If deducted through payroll
Other
- HSA / FSA - Health Savings Account or Flexible Spending Account contributions
- Union Dues - If applicable
- Garnishments - Court-ordered deductions, if any
Where to see your deductions
Your deductions live on the Income breakdown card on the Income view. The card groups them into a few buckets (taxes, retirement, and other) on top of your net income. Expand a bucket to see the individual line items your payroll provider reported - things like Federal Income Tax, FICA, your 401(k) contribution, and so on.
For how to get to the Income view on each platform, see the Income overview. For a per-paycheck view of every deduction on a single pay statement, see Viewing your pay statements. For more on the tax line items specifically, see Understanding tax withholdings.
Review your deductions at least once a year, especially after major life changes like getting married or having a child, to make sure your tax withholdings are still correct.
