Plain-language definitions for the payroll and tax terms you'll see across our paycheck calculator and guides.
Total earnings before any taxes or deductions are taken out — your hourly rate times hours worked, or your salary divided across pay periods.
Your actual take-home pay after all taxes and deductions have been subtracted from gross pay — the amount that lands in your bank account.
Federal Insurance Contributions Act — the payroll tax that funds Social Security and Medicare, automatically withheld from nearly all employee paychecks.
A job classification under federal law that determines overtime eligibility. Non-exempt employees must generally be paid overtime for hours worked beyond 40 in a week; exempt employees typically are not, regardless of hours worked.
The portion of your paycheck an employer sets aside and sends to tax authorities on your behalf, based on your W-4 form, as a prepayment toward your annual tax bill.
A form employees fill out for their employer that determines how much federal income tax is withheld from each paycheck, based on filing status, dependents, and other adjustments.
Money taken from your paycheck before taxes are calculated, such as 401(k) contributions or certain health insurance premiums, which lowers your taxable income.
The last payment an employer owes an employee after separation, covering all hours worked and, depending on the state, any accrued unused vacation time. Timing and requirements vary by state.