Understanding Your Paycheck

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Take Charge Today Introductory Level

Paycheck Basics

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What's the best part about having your first job?

For many it's the first paycheck.

Before payment occurs there are steps to complete.

What do you plan to do with your first big paycheck?

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W-4 Must be completed

To receive a paycheck, an employee must: Complete a Form W-4 ? Employee's Withholding Allowance Certificate ? Determines the amount of money withheld for taxes

? Provides information your employer needs to determine proper amount to withhold from a paycheck

? Required by law ? The amount of income tax you owe depends on

? Gross income ? Number of dependents

? Dependents: people you support financially (children)

? Expenses you pay

? Take Charge Today ? November 2014 ? Paycheck Basics ? Slide 3 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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Form W-4

? Your responsible for proper withholding

? Withholdings are employer deductions from employees' earning to pay employees' taxes

? Allowances

? An Allowance is the number that reduces the amount of income withheld from your pay.

? The lower the number of allowances the more money that is withheld from your check.

? Adjusting your allowance if you are withholding too much or too little.

? Overwithholding as a way to save

? Take Charge Today ? November 2014 ? Paycheck Basics ? Slide 4 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

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W-4 Must be completed

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