Deductions In My Paycheck
By The FoolProof Team
Congratulations! You just got your first paycheck. But what are all these deductions?
- Federal Income Tax - The federal income tax is a pay-as-you-go tax. This means you have to pay the tax as you earn money. The amount deducted from your check is determined by how much money you earn and how you filled out your W-4 form (one of those formal looking forms you had to fill out when you started your job).
- FICA stands for Federal Insurance Compensation Act. It's the proper name of Social Security. It has 2 parts: OASDI: Old Age, Survivor, and Disability Insurance, your after retirement Social Security income, and Medicare, your after retirement health insurance.
Depending on where you live, you may have some or all of these other deductions:
- State Income Tax
- City Taxes
- SDI - State Disability Insurance
You may not see the following deductions in your current check, especially if your job is part-time. But you will probably see these, or similar ones, with a full-time job or once you start your career.
- Retirement savings – for example, deduction for a pension or 401(k) plan.
- Insurance deductions to pay for one or all of these: medical, life, short term disability, long-term disability.
- Unemployment contributions.