When you get paid, do you really understand how your employer calculated your pay? Do you wonder why certain numbers appear on your paycheck stub? Do you wish you knew how to decipher these strange abbreviations? If so, then it's time to learn.
You'll find the most common abbreviations used on your paycheck stub and we'll explain exactly what they mean. We'll also look at some obscure ones that might even confuse you.
If you're wondering what "PTO", "PTD", "FWT" or "VAC" means on your payroll, then read on!
Why it is important to understand Pay Stub Abbreviations
Pay stubs are essential documents that show the exact amounts that are paid to employees within a specific pay period. Understanding pay stub abbreviations will help you to know how your income is distributed and if there are any errors in your paycheck.
For example, if you receive a paycheck that says $1,000 instead of $1,100, then your pay stub will tell you why because it will itemize each deduction that was taken from your pay.
Learning paycheck stub abbreviations will also help you know how much your employer withheld for federal and state taxes. You will need these amounts to calculate your annual income tax returns.
Let's deep dive into some common abbreviations and also some uncommon ones.
What Are Some Common Pay Stub Abbreviations?
Most states require employers to give their employees access to their pay stubs. There are also minimum requirements for the information that are set by both state and industry.
Pay stubs can be small and payroll providers use abbreviations to save space and make them easier to read. Most businesses will use standard abbreviations, but there are so many. Some common ones include:
401(k)/Ret - Retirement Plan
If you're not familiar with 401(k), it stands for Individual Retirement Account. This plan allows employees to save pre-tax dollars for retirement. Your employer will deduct the amount that you choose from your paycheck and then match some percentage of your contribution.
EIN - Employee Identification Number
An EIN number (Employee Identification Number) is a unique identifier used by employers to track employee income taxes. The IRS requires every employer to issue an EIN to each person who works for them.
If you're self-employed, you can use your social security number or you can apply for an EIN. This number allows you to file tax forms and pay taxes online.
FED - Federal Taxes or FWT Federal Withholding Tax
Federal Income Taxes (FED) are taxes that are automatically withheld from each paycheck by your employer and paid to the federal government on your behalf. When you file your annual income tax return, you might be due a refund or owe money, if there has been an over- or underpayment.
FICA - Federal Insurance Contributions Act
Federal Insurance Contributions Act (FICA) is a payroll tax, paid by employers to fund Social Security and Medicare benefits. The IRS requires an employer to withhold FICA taxes from each paycheck. The amount withheld depends on the employee's salary and the employee's elected exemptions indicated on their W-4.
FSA - Flexible Spending Account
Flexible Spending Accounts or FSAs are tax-advantaged accounts where employees can set aside pre-tax dollars to cover out-of-pocket medical expenses. This money is put in an account, an FSA, that you can access when needed and normally funds must be spent within the calendar year.
Garn/Garn% - Garnishment
The government has the right to take money out of your paycheck to satisfy debts owed to them. Here are some common garnishment abbreviations:
ChildSP1 - child support in your state
IRS Levy - Internal Revenue Service levy
BkrptGar - bankruptcy garnishment
StdnLoan - Student Loan
The wages can be taken as a garnishment percentage or as a flat rate.
Gross - Gross Pay
"Gross" pay is the total money you earned during the pay period before any deductions were made. This includes everything - any overtime hours worked, tips, bonuses, etc.
HOL - Holiday Pay Or Holiday Account
Some businesses have a Holiday Pay (abbreviated HOL) benefit, which is compensation paid to employees who take off work during certain government-mandated holidays.
INS/MED - Insurance/Medical Deductions
Your insurance premiums are a pre-tax deduction from your pay. There are many types of insurance that an employer might offer, including health, dental insurance, and vision insurance. Each type might have its own abbreviation or could be included in INS.
NET - Net Pay
Net pay refers to the total amount of take-home income earned during the pay period. This is the amount of money that you keep after all deductions are made.
You may be interested: Gross Pay vs Net Pay On Pay Stub - What's The Difference?
OT - Overtime
Overtime (OT) refers to hours worked beyond 40 hours per week. Federal law requires that overtime pay is no less than time and one-half the regular rate of pay.
PTO - Paid Time Off
Paid Time Off (PTO) allows employees to take paid leave for personal reasons, such as caring for sick family members, attending school events, or taking care of elderly parents. Some organizations distinguish between PTO and vacation time, so be sure that you understand your employer's terms for each.
REG - Regular Pay
The abbreviation "REG" on your pay stub stands for Regular Pay. It includes gross pay for the hours worked and any paid leave. It does not include overtime hours.
ST - State Tax
"ST" on your paycheck means State Tax. Not all states require a state income tax, so for many companies, there is no state tax withholding.
YTD - Year-to-date
"YTD," or Year-To-Date, is commonly used in accounting, finance, and payroll departments. It indicates the total amount paid out from the first day of the year through the date of the pay stub.
Less Common Pay Stub Abbreviations
Some pay stub abbreviations are pretty obvious, while others are less common. Here, we'll dive into some of the less common abbreviations you may find on a pay stub.
ACT - Acting Pay
On your pay stub, there may be an ACT symbol next to your hourly wage. This indicates that you were paid at a higher rate than usual during that pay period. Typically this pay is for taking on more responsibility.
ADM - Administrative Leave
A paid administrative leave is a temporary leave without any loss of salary or benefits. It is typically required by an employer during an investigation of a work issue.
BRVMT - Bereavement Pay
Companies might offer employees paid leave when a loved one dies. Bereavement leave is usually between one and five days, however, some will offer more. After that, employees use their PTO (see above) or go unpaid.
COB - COBRA
COBRA is an extension of health care coverage that is provided by employers, mandated by federal law. It allows employees to continue receiving health benefits if they lose their job. It covers spouses and children, as well.
FMLA - Family and Medical Leave Act
The Family and Medical Leave Act (FMLA) allows eligible employees 12 to 26 weeks of unpaid, job-protected leave per year for certain reasons. These include caring for a newborn baby, recovering from illness or injury, or attending to a serious health condition of a close relative.
FSS - Faculty Summer Salary
On most pay stubs, there is a section called "Other Compensation," where you might find the abbreviation FSS.
This indicates that you received extra compensation for teaching, research, or public service work done during the summer months
HCSA - Health Care Spending Account or HSA Health Savings Account
An HCSA, health care spending account, also called a health savings account (HSA), is a tax-advantaged savings plan that allows you to save money on a pre-tax basis to cover health care costs that your health insurance doesn't cover. Money left over at the end of the year will roll over to the next calendar year.
JURY - Jury Duty
Sometimes jurors are compensated by their employers and other times they are paid by the state. The laws differ, depending on which state you are in.
TUI - Tuition Reimbursement
TUI stands for "tuition reimbursement." Some businesses offer as much as 100% reimbursement for their employees to continue their education.
UD - Union dues
Union dues are taken to support various union activities. These include negotiating contracts, handling grievances, and providing other benefits to its members. Union membership is voluntary and its dues might also have a monthly or annual payment option.
VAC - Vacation Pay
If your employer offers paid vacation days, there may be rules regarding how that vacation time can actually be used, and some employers treat this differently than PTO, described above.
Conclusion — Contact Us
If you have any questions about pay stub abbreviations, please feel free to contact us. Real Check Stubs™ offers 24/7 customer service and we'd be happy to answer any questions you may have.
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