Everything about Pay Stub Deduction Codes
It is safe to say that both employer and employees have been having a difficult time trying to navigate the pay stub world because it concerns both of them. If you have been encountering pay stub deductions codes for quite some time but you still don’t understand a thing about them, you should be consoled by the fact that you are not alone. Lucky for you, pay stub deduction codes are simpler than you think and you just need someone to point you in the right direction. Here is a simple guide to understanding the different types of pay stub deduction codes.
The series of codes in a column designated as deductions on your pay stub highlights what your employer is directly deducting from you; there is no foul play involved, this is done to ensure you are doing your duty of paying taxes and contributing to various systems and this is what pay stub deduction codes are. Given you are adult earning an income in the America, it is your responsibility to pay federal income tax which is one of the pay stub deduction codes you will see on your pay stub; you have no choice whether to pay this or not.
In addition to federal income tax pay stub deduction codes, majority of states also levy a state income tax on their working adults but seven states do not and have come up with other ways of taxing their citizens. Social security as it is commonly known but will appear on your pay stub as deduction called FICA is another deduction code; this is paid by both employees and employers, commanding up to six point two percent of what you earn monthly.
Besides the aforementioned pay stub deduction codes, you will see another designated as MED, FICA MED or FIM and is part of the social security the only difference is it doesn’t go into the pot because it is set aside for Medicare only. Medicare is a one point five percent deduction of your pay that is meant for only Medicare and nothing else. At the bottom end of you pay stub you will see pay stub deduction codes for any benefits extended by your employer and you are a part of; deductions will be made monthly.
By now you understand that different employees offer different benefits which you can enlist for or choose the one you want knowing the contributions will be deducted from your paycheck monthly and will appear differently on your pay stub. You can become a pay stub by reading blogs and posts on pay stubs to have an idea of what it should look like; the things it should entail and the deductions codes you should expect to see monthly. These are the pay stub deduction codes and their various uses.
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