Using A Paystub To Calculate Your W-2
It’s that time of the year we are all dreading once again – tax season. It adds stress and hassle to the already very tiring days of our lives. Here in this article, we are going to be talking about taxes and how to go about that entire process of calculating your W-2 wages from a paystub, so scroll down now to learn more.
Most people don’t jump in on the entire tax process without getting their W-2. This is because the information contained in your W-2 form at https://www.paystubcreator.net is needed in preparing your tax return. But if you don’t have the W-2 form yet, you don’t have to keep painstakingly waiting as you can get that same information on just one pf your paystubs, so let’s get on it!
Before we dive right into it, let’s tackle one of the most commonly-asked questions out there: what is the difference between a paystub and a W-2? A common mistake between those who are not familiar with the payroll or tax process is getting their W-2 and paystub all mixed up. It is essential that as early as now, you will understand what makes the two of them different because if not, you will encounter huge potholes in the tax process. So in this site, we’ll be telling you exactly what a paystub, final paystub, and a W-2 is.
The first one on the list is the paystub. A paystub at https://www.paystubcreator.net/blog/how-to/how-to-calculate-w-2-wages-from-a-paystub is the paycheck you receive from your employer whenever you get paid for your services. It contains information about your pay, including how much money you have earned in that certain pay period, the year-to-date payroll, and others like the deductions and taxes that have been taken out of your total earnings. After removing those deductions and taxes, you can see from your paycheck the actual amount that you can get from the paycheck, or more commonly referred to as your net earnings.
Now, a final paystub is the very last paystub you will be given at the end of the year which will tell you the gross and net income for the whole year. To know more about paystubs, visit this website at https://en.wikipedia.org/wiki/Pay.
Lastly, a W-2 form will tell you the total amount of taxes – including state and federal taxes – that have been withheld from your paycheck of that entire year.
So in the end, you will see that a paystub may not exactly give you the same information from a W-2, but it contains the essentials that you will need to figure out your overall net income by doing these steps.
The first thing to do is look for your gross income. Second, total the non-taxable wages and subtract it from the gross income. Third, subtract other deductions from that number, and fourth, determine annual taxes and multiply them by the number of times you are paid every year. Last of all, subtract the total taxes from the number in step three and you’ll have your net income.
View here on this page a more comprehensive breakdown now.