Gross – Total amount of money you’ve earned during that pay period.
Net – The amount of money you “take home” after all of your deductions have been taken out of your paycheck.
Withholding – a fancy way of saying “holdback.” For instance, your employer is required to withhold income tax out of your paycheck and makes sure the government gets your tax payment. You manage how much to “hold back” by declaring how many exemptions you want to claim.
Deductions – Amounts subtracted from your paycheck.
Exemption – A claim of a condition that would exempt you from paying taxes on a certain portion of your income (such as a dependent).
Dependent – A person who relies on you for financial support.
Did You Know
You can impact whether you get a refund or have to make a tax payment at the end of the year by changing the number of deductions you make on your paycheck.
Free Money and Other Income
Did you know, You can get free money from your employer by taking advantage of 401k matching benefits. Make sure you contribute enough to max out the match!