How to Make a Pay Stub: A Step-by-Step Guide for Employers (2026)

A pay stub (also called a check stub or earnings statement) shows an employee how their pay for a period was calculated: what they earned, what was withheld, and what they actually take home. Many states require employers to give employees a pay statement every payday, and a clear stub makes your payroll records easy to check later.

This guide walks through what a pay stub must include and how to make one correctly.

What goes on a pay stub

A complete pay stub usually shows:

Employer details: business name and address, and often the EIN.
Employee details: name, address, and the last four digits of the SSN (never print the full number).
Pay period and pay date: the start and end dates of the period, and the date the employee was paid.
Earnings: hours and rate for hourly workers, or the salary amount for the period, plus overtime, bonuses or other earnings.
Taxes withheld: federal income tax, Social Security, Medicare, and any state and local taxes.
Deductions: pre-tax items such as retirement contributions or health insurance, and post-tax items such as garnishments.
Net pay: what the employee receives after everything above.
Year-to-date (YTD) totals: running totals of earnings, taxes and deductions for the calendar year.

Step 1: Work out gross pay

For hourly employees, multiply hours worked by the hourly rate, then add overtime (under federal law, usually 1.5 times the regular rate for hours over 40 in a workweek; some states have stricter daily rules). For salaried employees, divide the annual salary by the number of pay periods in the year: 52 for weekly, 26 for biweekly, 24 for semi-monthly and 12 for monthly.

Step 2: Subtract pre-tax deductions

Deductions such as traditional 401(k) contributions and most employer health plan premiums come out before income tax is calculated, which lowers taxable wages. Check each benefit's rules: some pre-tax deductions still count toward Social Security and Medicare wages.

Step 3: Calculate federal income tax withholding

Federal income tax withholding is based on the employee's Form W-4 (filing status, multiple jobs, dependents and other adjustments) and the IRS Publication 15-T tables for the year. The common approach is to annualize the period's taxable wages, apply the standard deduction and tax brackets for the filing status, subtract any credits from the W-4, and divide back down to the pay period.

Step 4: Calculate Social Security and Medicare (FICA)

Social Security is 6.2% of wages up to the annual wage base, and Medicare is 1.45% of all wages, with an Additional Medicare Tax of 0.9% on wages above $200,000 for the year. The employer pays a matching share, but only the employee's share appears as a deduction on the stub.

Step 5: Add state and local taxes

Most states have an income tax with their own brackets and rules, and some add payroll taxes such as disability insurance. A few states and cities also have local income taxes. States like Texas and Florida have no state income tax, so only federal tax and FICA apply. Our state paycheck calculators show how this works for each state.

Step 6: Subtract post-tax deductions and find net pay

Take gross pay, subtract all taxes and every deduction, and what is left is net pay. Then update the year-to-date totals so the next stub continues correctly.

The faster way: use a pay stub generator

Doing this by hand every payday is slow and easy to get wrong. With Thi Pay Stubs you enter the company, employee and pay details once, and federal, FICA and state taxes for all 50 states are calculated as you type. You can preview the stub live, choose one of seven templates, and download a PDF. Your first two pay stubs are free.

Keep your records accurate

A pay stub is a record of wages you actually paid. Keep copies with your payroll records, make sure the numbers match what you deposited, and give employees their stub on payday.