What are 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. Majority of both employers and employees are stick stuck trying to figure out what pay stub deduction coded are, their meaning and how they work. All the problems and hassles you are going through trying to figure out pay stub deduction codes can be easily cleared. This article will educate you on the different types of pay stub deduction codes and what they are used for.
Pay stub deduction codes are the codes you see in a column when you look at your pay stub that shows what your employer is taking from you to ensure you are paying your taxes and contributing to various systems. One of the most common pay stub deduction code you will often see on your pay stub is federal income tax which is a tax levied on all working adults working in the country; you have no say about this.
Another pay stub deduction code likely to appear on your pay stub is state income tax which is levied by almost all American states except seven which go about it in a different way. Besides federal and state income tax, you will see a pay stub deduction code listed as FICA on your pay stub; every employer and employee are expected to contribute up to six percent of the monthly salaries towards this deduction which is commonly known as social security.
When you see a pay stub deduction code on your pay stub called MED, just know it is meant to take care of you because although it is part of the social security system, it is usually put aside for Medicare only. Another difference you will notice between Medicare pay stub deduction code and FICA is that it only takes about one point five percent of your income. Life insurance, health insurance and dental cover are some of the benefits often offered by most employers to their workers which they have to contribute to monthly, if you are a beneficiary of such, you will see pay stub deduction codes on your pay stub.
If your employer offers dental cover benefit and you are a part of it, it will appear on your pay stub as DEN or DENT for sake of ease. 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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