Employees go to work every single day, conducting different tasks and upholding responsibilities that their employers require them to do. So naturally, once payday arrives, employees expect to be compensated for the amount of work that they have produced. However, employees have a right to know how much they’re making and why they’re making the amount they have received.
This is the reason why employers have to make check stubs. With check stubs, employers can give these employees all of the important details regarding how much they earn and other things that affect their pay. So this article will focus on how to make check stub templates and how you can read them.
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Free Paycheck Stub Template
Blank Check Stub Template
Printable Check Stub Template
Paycheck Stub for Hourly Wage Employee
Check Stub Example
How to make check stubs for your employees
With the help of a check stub, also known as a pay stub, employees will be able to keep track of all the taxes that were taken out of their paycheck, the amount of the taxes, the hours that they have worked, and information regarding their year-to-date payment amount. Employees are also going to need these check stubs in the event that they’re going to apply for a loan, refinance their home, or for when they have to fill their children’s financial aid forms. So if you’re going to make a pay stub, here are the steps that you need to take:
- Download a free check/pay stub template. There are a lot of these available online, so all you have to do is find the one that you think you can best make use of. Once you’ve decided on the one that you want to use, then you may paste it on your computer’s word processing program where you’ll be able to customize it to your heart’s content.
- If you decide not to make use of a template, then what you can do is open up your computer’s spreadsheet application. One of the best ones you can use is Microsoft Excel as you can get it easily, although you can find others online that you may want to use. Open up the application and give your spreadsheet a header. The header should contain the name of your company as well as its address.
- The next step would be for you to place the full name of the employee and his or her social security number on the top left hand of the stub. Once you’ve finished placing this information, list down the pay period and the date when the paycheck was written.
- List the rate of pay and the overtime rate right underneath the employee’s full name. Then you’re going to have to follow that with the amount of regular hours that the employee has worked, as well as the amount of overtime worked on the next line.
- The next thing to do is to include all of the deductions that should be taken out of the employee’s wages. These deductions include several things such as federal taxes, state taxes, social security, medicare, and much more.
- Then to finish the stub, all you have to do is list all of the year-to-date information. Once you’ve done that, print it out and distribute the stubs to your respective employees along with their paychecks.
Check Stub Template in Excel
Basic Paycheck Stub Template
Employee Payroll Sample
Simple Check Stub Format
Individual Check Stub Template
What should be included in a check stub?
While every company makes and prints their own unique check stubs, there are some details that employers must include in the stubs as mandated by law. Some of these stubs can be extremely detailed and some will only have the required information. The following items will appear on every pay/check stub that an employee receives:
- Gross pay. This is the total amount of money that an employee has earned throughout a particular pay period. The pay period is determined by the employer and it can be anywhere from weekly, bi-weekly, or even monthly. Note that gross pay does not factor in tax withholdings.
- Net pay. This is the amount of money that the employee gets to take home. This is the amount that’s left after the employee’s gross pay has had all the necessary deductions taken out of it. So basically, it’s the money that goes straight into the employee’s bank account.
- Federal tax amount. When you were initially hired by your employer, you were required to fill out a W-4 form. This form covers what you may or may not owe the federal government when tax time comes. The type of taxes and the amount all depend on the number of exemptions you chose to claim in your form. If you would like to change some of these exemptions, then you can contact your human resources to help you fill out another form.
- State tax. Depending on the state that you live in, assuming that you live in the U.S, you may or may not be required to pay a state tax. However most states do require you to pay these taxes, so the amount will be deducted from your paycheck, too. This will cover the amount that you owe the state when your tax return is filed.
- Local tax. Although this is rare, local taxes are charged to employees in certain cities and countries. The reason for this is because there are some cities and/or counties that need these taxes in order to pay for public projects such as road construction or maintenance and even healthcare projects.
- Social security tax. Your employers are required to pay this kind of tax as this is the one that’s going to fund your retirement. When you’re eligible for social security, you’ll be given a monthly payment by the government. The standard amount that both the employees and the employers are required to pay the social security tax is at least 6.2% of the total paycheck.
- Medicare. Just like social security withholdings, these are mandatory. The medical program is what takes care of one’s medical treatments and bills in the event that the person is eligible for social security. Both the employee and the employer have to contribute 1.45% of their paycheck toward the Medicare program. The employer even pays an additional 1.45% on behalf of the employee.
- Year-to-date. The year-to-date fields on your paycheck stub show just how much you have paid to a particular withholding at any point within the year. This is very useful in the event that the employee wishes to budget monthly expenses or if the employee has long-term goals.
As mentioned before, employees have the right to know about the amount of money that they’re making, as well as the reason why they’re making the amount that they’re receiving. They need this valuable information as it will help them plan out how to properly manage their personal finances. Plus, if an employee doesn’t hand these out, then it could lead to some serious legal issues that can only lead to more problems for the company.
So if you would like to know more about pay/check stubs, then you may go through any of our available templates that will provide you with more ways on how to make these stubs, as well as help you learn more about their purpose and why employees benefit from them.