Paychecks: Why is the Net Pay different than before?

If you're comparing checks that have the same gross pay, here's why the net pay might be different:

• If this is your first payroll with us, your previous method of calculating taxes may have been different than the method we use (known as the annualized method for calculating income tax withholding).
• Tax rates may have changed (especially in January) for local, state, or federal taxes.
• An employee might have reached the maximum yearly amount for a deduction. If the deduction is no longer taken out of the check, net pay will be larger.
• An employee may have reached the wage cap for a specific tax. For example, in 2012, employees pay Social Security tax only on their first $110,100 of wages. (In 2014, the wage cap is $117,000.)
• You may have made changes to the employee's withholding status, deductions, allowances, or voluntary contributions.
• We round year-to-date withholdings up or down. (The difference will be less than a dollar.)

If net pay is significantly different, and none of the reasons above apply, contact us so we can help you find out what's changed.

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