How to Read a Pay Stub: Earnings, Taxes and YTD (US)
A US pay stub—also called a paycheck stub, earnings statement, or pay statement—explains how an employer moved from an employee’s earnings to the amount paid. The exact format and required fields vary, but a useful statement should let the employer and employee reconcile the pay period against genuine payroll records.
This guide explains common fields for general educational use. It is not individualized payroll, tax, accounting, employment, or legal advice.
Start with the identity and pay-period details
Check these fields before reviewing the arithmetic:
- Employer name and address: the business or other employer responsible for the payment.
- Employee name or identifier: enough information to associate the statement with the correct employee without unnecessarily exposing a full Social Security number.
- Pay-period start and end: the dates when the work or earnings were recorded.
- Pay date: the date the payment was issued.
- Pay frequency: weekly, biweekly, semimonthly, monthly, or another actual schedule.
The US Department of Labor lists the date of payment and the pay period covered among the basic records covered employers maintain under the Fair Labor Standards Act. It also lists hours, pay basis, earnings, additions, deductions, and total wages. See DOL Fact Sheet #21.
Understand each earnings line
An earnings table may separate:
- Regular hours and rate
- Overtime hours and the actual overtime rate
- Salary for the period
- Bonus, commission, tips, or another form of compensation
- Reimbursements or additions, where applicable
For an hourly line, the basic arithmetic is:
hours × rate = current earnings
A flat salary or bonus line may show only an amount. Do not assume an overtime rate or tax treatment from the label alone; the underlying employment and payroll records control.
Gross pay is not the same as net pay
Gross pay is the total current earnings shown before employee deductions. Net pay is the amount remaining after the deductions on the statement:
gross pay − employee deductions = net pay
That subtraction is useful for checking the statement, but not every payroll concept can be reconstructed from the visible total. For example, Social Security taxable wages or Medicare taxable wages may differ from gross pay in some payroll situations.
Social Security and Medicare withholding
For 2026, the employee Social Security rate is 6.2% on Social Security taxable wages up to the annual $184,500 wage base. The employee Medicare rate is 1.45%, and Medicare has no wage-base limit. Employers also withhold an additional 0.9% Medicare tax when wages they pay an employee exceed $200,000 in the calendar year.
Those are employer-withholding rules, not a complete calculation of an individual’s final federal tax liability. The IRS explains the 2026 rules in Publication 15 and Topic 751.
Federal income-tax withholding is separate. It depends on the payroll facts and the employee’s withholding information, so it cannot be reliably calculated from gross pay alone. State and local withholding rules also vary.
Other deductions
Other lines may include retirement-plan contributions, health coverage, garnishments, union dues, repayments, or other authorized deductions. Their tax treatment is not necessarily identical. A pay stub should reflect the actual payroll calculation rather than treating every deduction as reducing every tax wage base.
If a deduction is unfamiliar or appears incorrect, compare it with the employee’s elections, benefit documents, court or agency order where relevant, and the employer’s payroll records.
What YTD means
Year to date (YTD) means the total from the beginning of the calendar or payroll year through the current statement. A reliable YTD figure is:
actual total before this pay period + current amount
Multiplying one current paycheck by the pay-period number is only an estimate and can be wrong when hours, rates, bonuses, deductions, or taxes changed. DraftFort’s generator therefore leaves YTD off by default and displays it only when the user enters genuine prior totals.
Fictional reconciliation example
The following numbers are illustrative only and are not a recommended payroll calculation:
| Line | Current amount |
|---|---|
| Gross pay | $2,000.00 |
| Federal income tax entered from payroll | $150.00 |
| Social Security shown | $124.00 |
| Medicare shown | $29.00 |
| State income tax entered from payroll | $50.00 |
| Health deduction | $100.00 |
| Total deductions | $453.00 |
| Net pay | $1,547.00 |
The reconciliation is $2,000.00 − $453.00 = $1,547.00. The Social Security
and Medicare figures in this simple example equal 6.2% and 1.45% of $2,000,
respectively. That simple relationship would not establish that $2,000 is the
correct taxable wage base in every real payroll situation.
Does federal law require an employee pay stub?
The federal FLSA requires covered employers to keep accurate wage and hour records, but the Department of Labor says the FLSA does not itself require an employer to provide employees with pay stubs. State and local requirements may be different. See the DOL’s official pay-stub FAQ and check the authority governing the employee’s workplace.
What to do if a pay stub appears wrong
- Compare the employee name, pay period, hours, rate, and payment date with the source records.
- Recalculate each earnings line and the gross-to-net subtraction.
- Check whether the taxable wage bases differ from gross pay.
- Compare withholding and deductions with the actual payroll calculation.
- Ask the employer or payroll administrator to investigate and correct an error.
- Use the appropriate labor or tax authority, or a qualified professional, for an unresolved compliance question.
Employers should retain the records supporting payroll and employment-tax figures. The IRS says employment-tax records generally must be kept for at least four years. See IRS employment-tax recordkeeping.
When an authorized employer needs a formatted statement based on genuine records, use DraftFort’s private US pay stub generator. The form runs locally, draft-saving is optional, and the finished PDF directs questions about the payroll information to the named employer or payer.