Paycheck Stub	
Paycheck Stub (page 1 of 3)	
Employers pay workers for hours worker every "pay period.  Pay periods m
ay be: 1) once per week; 
2) once every other week; 3) twice per month; 4) once per month.  Emp
loyers may pay workers with:
•  PAYCHECKS - Employers may handwrite paper paychecks — or use a computer to print
 out paper 
paychecks to give to workers.  Most employers pay young workers with pap
er paychecks.  
•  DIRECT DEPOSIT - About 82% of workers ask employers to electronically send the paycheck 
money to their bank for direct deposit into the worker's bank account.  
With direct deposit, workers do 
not need to physically visit the employer to pick up a paper paycheck. 
•  PAYROLL CARDS (plastic ATM cards) - Employers place money earned for the pay period on each 
worker's payroll card.  Then, workers can use the payroll card to purchase items in stores or wi
thdraw 
cash from an ATM.  Only employers can place money on a worker's payroll card.  CAUTION
: Do not 
tell anyone your payroll card's PIN (Personal Identification Number).  Call your employer's bank and 
your employer immediately to report a lost or stolen payroll card.  
•  CASH - Employers who pay in cash are required by law to take out taxes and kee
p records for cash 
paid workers.  The IRS (Internal Revenue Service) may inspect employers who pay worke
rs in cash to 
make sure both workers and employers are paying correct amount of taxes 
owed to the government. 
UNDERSTANDING PAYCHECK WORDS
PAYCHECK STUB - Employers must provide every worker with a paycheck 
stub every time the worker is paid.   Paycheck stubs list hours worked f
or 
the pay period, earnings, and all deductions (money taken out of a work
er's 
pay).  Employers may give workers paper paycheck stubs — or ask 
workers to use a computer to go to a website, enter user name and 
password, then print out the paycheck stub. 
GROSS (OR TOTAL) PAY - Total wages earned during the pay period.  
If you worked 30 hours in a weekly pay period and earn $15 per hour, 
your gross pay will be $450 (30 hours times $15). 
INCOME TAX - You must pay income tax (federal and sometimes state) on earnings.  Emp
loyers are 
responsible for withholding (taking out) income tax from your earnings
 and sending it to the federal and 
state government.  
W-4 FORM - Before your first day of work, you will fill out a W-4 form (called Employer’s Withholding  Allowance) to tell your employer how much income tax money to deduct (
take) out 
of your pay.  A single worker has more income tax money taken out than worker 
who supports 3 children.  This is because the government gives "exemptions" for 
workers with dependents (or children).  On the W-4 form, each exemption claimed 
lowers the amount of income tax taken out of your pay.  Exemptions are also 
available when worker has a disability, blindness, or over 65 years of age.	
PAYCHECK STUB

Permission to use with usworkworld.com subscription.  	Paycheck Stub (page 2 of 3)	
QUICK CHECK:
1. List 4 types of pay periods.
2.  List 2 ways employers prepare paper paychecks.  
3.  What do 82% of workers ask employers to do?  
4.  a) What do employers place on each worker's 
payroll card?  b) Workers can use payroll card to 
do what 2 things?  c) What are 2 CAUTIONs?
5.  a) When must employers provide paycheck 
stubs?  b) What 3 things do paycheck stubs list?  
c)  List 2 ways workers get their paycheck stub.  
6.  a) Define "gross" pay.  b) What is gross pay of 
worker paid $24 hourly and worked 40 hours?
7.  a) What is the W-4 form called?  b) What does 
the W-4 form tell the employer?  c) What does 
each exemption claimed on the W-4 form do?  
8.  a) For what words does FICA stand?  b) What  are the 2 parts of FICA tax?  
9.  What percent of gross pay is:  a) Social Security 
tax?  b) Medicare tax?  c) FICA tax?
10.  How long must worker pay social security taxes 
to get benefits?
11.  Briefly describe:  a) Retirement benefits.  
  b) Disability benefits.  c) Family benefits.  
  d) Survivor's benefits.  e) Medicare.
12.  a) What insurances may employers require you 
to pay?  b)  List 2 ways you may pay union dues.
13.  a) Define "net" pay.  b) List 7 items that may be 
deducted (taken out) from your gross pay.
14.  If your employer forgets that $50 was taken out 
of your paycheck each week to put in your 
  savings account, what can you show the 
  employer to prove the money was taken out?  
FICA (FEDERAL INSURANCE CONTRIBUTIONS ACT) -  FICA tax on your paycheck stub is 
divided into two parts:  1)  Social Security tax which is 6.2% of gross pay; and 2)  Medicare tax which 
is 1.45% of gross pay.  Employers may combine both Social Security and Medicare and call it F
ICA tax.  
FICA tax is 7.65% (6.2% Social Security plus 1.45% Medicare).  
Social Security gives benefits to workers who paid social security taxes 
for at least 10 years:   1) Retirement Benefits:  Monthly retirement 
income at age 67 (if born 1960 or later).   2) Disability Benefits:  
Monthly disability income if worker receives physical or mental 
condition that is expected to prevent worker from working for more than 
one year.  3) Family Benefits:  If worker retires or becomes disabled, 
members of worker's family may be eligible to receive monthly benefits.   4) Survivor’s Benefits:  If a 
worker dies, members of his or her family may be eligible to receive monthly benefits.   5) Medicare 
Benefits:  Government paid medical insurance for the worker at age 65.  
HEALTH INSURANCES -   Employers may deduct all or part of the cost of your medical insurance
.  Or, 
employers may pay for your medical insurance, but require you to pay for
 any dental or vision insurance.  
UNION DUES -   If your place of employment is covered by a union contract, union dues 
may be taken out 
of your paycheck — or, sometimes union workers must go to the union office to pay union dues.
VOLUNTARY DEDUCTIONS -  Workers may choose to sign-up for voluntary 
paycheck deductions to support a charity or to place money into their sa
ving account. 
NET PAY - Amount of money you are paid after all deductions are subtracted from 
your gross pay.  Therefore, gross pay minus deductions for federal income tax, state inco
me tax, social 
security tax, medicare tax, health insurance, union dues, and voluntary 
deductions equals  N E T  PAY.

1. a) How much is Jason paid per hour?  b) How 
much is Julie paid  per hour?  (Pay divided by 
hours worked each week)
2.  Jason is paid $30 hourly for overtime.  a) How 
many hours of overtime did Jason work?  
  b) How many hours of overtime did Julie work?
3.  Traditional 401K retirement savings plan:  
  a) What are workers allowed to do?  b) When 
are taxes due?  c) When the worker is how old?
4.  Roth 401K retirement savings plan:  
  a) What are workers allowed to do?  
  b) Since taxes have been paid, at what age may 
money be taken out of the Roth 401K plan? 
5.  a) Does Jason pay into a Traditional 401K Plan?
  b) How much per paycheck?  
  c) Does Julie pay into a Traditional 401K Plan?
QUICK CHECK:	
Paycheck Stubs (Page 3 of 3)	
Weekly Paycheck Stub:  Jason
Single man, no children
40 hours per week.  Pay is $800 per week.
Wages:  $800.00
   Overtime Wages:  $60.00
   Total Wages:  $860.00
   Traditional 401K Plan:  $75.00
Total Wages Taxable (after 401K):  $785.00
Deductions:
   Federal Income Tax:  $65.00
   Social Security (6.2% of taxable wages):  $48.67
   Medicare (1.45% of taxable wages):  $11.38
Benefits - Employee (Worker) Paid
   Vision Insurance:  8.00
Net Pay after deductions:  651.95
 
Benefits - Employer Paid for Workers:
   Health Insurance:  $40.00
   Dental Insurance:  $10.00
   Retirement Plan (10% of taxable wages):  $78.50 Weekly Paycheck Stub:  Julie
Single woman, 2 children
35 hours per week.  Pay is $630 per week.
Wages:  $630.00
   Overtime Wages:  $0
   Total Wages:  $630.00
   Traditional 401K Plan:  $0
Total Wages Taxable (after 401K):  $630.00
Deductions:
   Federal Income Tax:  $44.23
   Social Security (6.2% of taxable wages):  $39.06
   Medicare (1.45% of taxable wages):  $9.14
Benefits - Employee (Worker) Paid
   Vision Insurance:  $0
Net Pay after deductions:  ___________
Benefits - Employer Paid for Workers
   Health Insurance:  $40.00
   Dental Insurance:  $10.00
   Retirement Plan (10% of taxable wages):  $63.00
RETIREMENT SAVINGS PLANS
Traditional 401K  - Allows workers to save money from every paycheck  BEFORE taxes
are taken out.  Taxes are due when money is withdrawn from 401K plan at age 59 ½.
Roth 401K - Allows workers to save money from every paycheck  AFTER taxes are 
taken out.  Money may be taken out of the Roth 401K retirement plan at a
ny age without taxes due.
6. Why are Jason's "Total Wages Taxable" lower 
than "Total Wages" but Julie's are not?
7.  Why do you think Jason, a single man, pays 
more federal income tax than Julie?
8.  What percent of taxable wages do workers pay 
for:  a) Social Security?  b) Medicare?
9.  List 3 benefits that the employer pays for both 
workers, Jason and Julie.
10.  Which worker selected to pay for vision 
  insurance?   
11.  a) If you worked at the same place as Jason 
and Julie, would you select to pay for vision 
insurance?  b) Why or why not?   c) Would you 
select to pay into a 401K retirement plan?  
  d) Why or why not?
12.  What is Julie's "Net Pay after deductions?"