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A Guide To Help You Calculate W-2 Wages From A Paystub

To prepare the tax return that is expected of you every year, he needs to get information from your W-2 form. If you do not have your W-2, it is still possible for you to prepare tax returns by getting the information that to be on your W-2 from one of your paystubs. Your pay stub is the paycheck that you receive from your employer every time you get paid. Some of the details that you will find in the paystub include your pay for each pay period and the year to date payroll, deductions and taxes that have been taken out of your total earnings, and your net earnings. You also get a final paystub by the end of the year which shows the gross and net income earned throughout the year. The W-2 form, on the other hand, is a tax form which shows the amount of taxes that have been taken from your paycheck during the year. Learn how to calculate your W-2 wages from a paystub in this article.

Finding your gross income will be the first step that you take. The gross income is the total amount of money that you will have and without deductions and taxes. For a majority of people, this amount is the number of hours that they work within a week multiplied by the hourly rate. The amount will also include any income from commissions, bonuses, and overtime hours.

After this, you will need to subtract nontaxable wages out of the gross income. The nontaxable wages will be comprised of the wages you received that you do not have any state, federal, or income taxes. Among the nontaxable wages may include gifts, employer insurance, disability wages, and partnership income.

The other thing to do is to account for other deductions which will reduce your amount of taxable income. Various things that can be included here are life insurance, health insurance, retirement accounts, and employer benefits among others. Once you have added up the other deductions, you will deduct the sum from what you got in the second step. Their mom to get will be your total taxable income for the year.

After that will be the determination of your yearly taxes. Find out what amount of state, local, and income taxes on your paystub which are withheld from your earnings. After that, you’ll get the product of the numbers with the number of times that you are paid per year. The number that you get will be the total amount of taxes that will be withheld from your earnings that year.

The final step will be to subtract the total taxes that will be withheld from your income from what you got in step three. This will represent your W-2 earnings already or net income for the year.

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