Earn That Money!
An automatic deposit of wages or benefits (such as payroll payments) into an employee’s bank account.
Direct Deposit
Income paid as a percentage of sales.
Commission
Type of incentive program that companies usually pay employees based upon a business’ profitability, that provides a bonus to the regular employees of a business.
Profit Sharing
The federal agency responsible for administering and enforcing the U.S. Treasury Department’s tax revenue laws through assessment and collection of taxes.
Internal Revenue Service (IRS)
Payment in the form of money, time, or benefits for completed work
Compensation
Attached to the paycheck to show the deductions.
Pay Stub
An amount of money that you can subtract from the amount of taxes that you owe.
Tax Credit
An individual whom a taxpayer can claim for credits and/or exemptions because they provide the majority of support for that individual’s living expenses.
Dependent
The total amount of money earned during the pay period before tax deductions.
Gross Pay
Earned income after deductions
Net Pay
Money subtracted from gross pay for required taxes, employee insurance, and retirement benefits.
Government fees on business and individual income, activities, products, or property.
Taxes
These are the three levels of taxes.
Local, State & Federal
The federal act under which mandatory contributions for Social Security and Medicare are deducted from one’s pay.
Federal Insurance Contributions Act (FICA)
These are examples of this type of deduction: pensions, 401k, 403b
Retirement
To be free from, or not subject to, taxation by regulators or government entities.
Exemptions
A labor market where organizations rely on short-term contracted employees to complete tasks, with workers completing work within the confines of their own selected schedule.
Gig Economy
These are examples of this type of deduction: health, dental, vision, life, and disability.
Insurance
Number of employee-claimed exemptions, typically the number of people one can claim as dependents, in determining income tax withholding.
Allowances
A federal government program that provides health insurance coverage for people who are 65 or older or have certain disabilities
Medicare
Also known as the Employee’s Withholding Allowance Certificate. Information within this form determines the percentage of gross pay to be withheld for taxes.This document is completed at the beginning of one’s employment.
W-4
Also known as the Employment Eligibility Verification Form. Information gathered on this form is for employers to verify eligibility of individuals for employment.
A federal government program that provides monetary benefits to people who are retired or are disabled.
Tax form that reports other sources of income (such as bank account interest, investment dividends, or lottery winnings) earned in a tax year.
1099
A summary, provided by the employer, of the amount of money earned and taxes withheld throughout the previous year.