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What does Federal Tax Gross mean on a paycheck stub?
I have seen on a paycheck Total Gross and then to the right I see Federal Tax Gross. I know Total Gross is before tax is taken out, but what exactly is Federal Tax Gross and what does it mean?
3 Answers
- troLv 77 years agoFavorite Answer
Federal tax Gross means the amount that is taxable for federal income tax
- Steve DLv 77 years ago
Companies are allowed to let employees make pre-tax deductions for things like health care or retirement plans. This lowers the amount that an employee gets taxed on by the Federal government.
So if you had a qualifying $100 deduction go into your 401(k), your paycheck might say somethinglike:
Gross Pay: $1,000
Retirement Contributions pre-tax: $100
Federal Gross Pay: $900
- StephenWeinsteinLv 77 years ago
Total gross is before taking out taxes, retirement plan contributions, health insurance, etc.
Federally taxable gross is before taking out taxes, but after taking out retirement plan contributions and health insurance.
Medicare gross is before taking out taxes and health insurance, but after taking out retirement plan contributions.
If you're not confused yet, it gets even weirder if you do state taxes and work in one state while living in another.
