- Dec 13, 2023
What is YTD on Paystub?
Employers and Employees need to pay attention to the year-to-date (YTD). Payroll YTDs are required to record and keep calculations of tax obligations and provide accurate tax documents to employees at the year’s end.
The reuniting between the YTD values and the year-end form values must be watched for the IRS to accept the year-end forms. In this blog, we shall learn about what YTD means and what is YTD on a real paystub. Let’s begin.
What is Year-To-Date (YTD) on a Paystub?
Year-to-date (YTD) is a cumulative earnings accrued from the start of the year to the current payroll. YTD is generally calculated as a standard sum of similar line items on each paystub from the beginning of the year.
A Paystub monitors various YTDs like regular earnings, withholdings and other deductions, along with gross and net pay. For example, if an employee works on 1st January 2024 for $1,000 gross paid semi-monthly, the gross YTD on April 1, 2024, will be $6,000, with 6 being the number of semi-monthly tax periods.
Why is Year-To-Date (YTD) Important?
Each time, an employer has to provide their employees with a paystub whenever they are paid. The paystub includes various earnings, taxes, deductions and any kind of refund for the employee in that pay period, along with total gross and net earnings.
What are the things that an employer should know?
- YTD values on paystub allow employers to get a handle on how much they incurred in a particular month, quarter and year.
- Apart from balancing the accounting books, the numbers play a pivotal role in calculating and filing quarterly and yearly tax liabilities.
- The quarterly filing includes IRS form 941 and other state withholding and unemployment insurance filings.
- YTD values, as the name suggests, are used in the annual filing of payroll and employment forms- W2 or 1099, IRS form 940, and another state compromise yearly form.
- Understanding a Year-To Date helps employers keep track of their tax liabilities, project payroll costs, and help them make decisions on new hires and other financial activities of the business.
What are the things that an employee should know?
- Employees should pay close attention to YTD numbers on their paystub to see how much they earned year-to-date and how much they paid towards taxes and other deductions.
- A perfect paystub will have all the earnings broken down as regular earnings, overtime and holiday pay. The taxes and deductions include federal and state withholdings, FICA, health insurance, and potential benefit deductions.
- Employees can compare the YTD values to the annual W-2 that they receive from their employer. For example, the total earnings reported on Box 1 on W-2 must closely see the total YTD of the earnings on the last paystub for the year.
Basic YTD Values Reported on a Paystub
|YTD Gross Pay
|Total amount of employee earned for the year
|YTD Deductions and Benefits
|Total amount that was deducted from employee wages for 401(k) and other health savings account
|YTD Federal Taxes
|The total amount of federal taxes withheld from employee paycheck for a year.
|YTD State Taxes
|The total amount of state taxes withheld from employee paycheck for a year.
|The total amount of reimbursement made to an employee for a year.
|YTD Net Pay
|The total amount of employee earned after taxes and deductions.
|The total amount of hours the employee worked for a year.