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Employers use pay stub generators to produce pay stubs that reflect the pay and deductions for the specific time period. A pay stub shows how the employee earned the income and how the income was calculated. It highlights the final amount that was paid to the employee.
This is an important aspect of recordkeeping, taxes, and verifications. Pay stubs without mentioning the pay period can create confusion. They are rejected during the review of documents.
In the following sections, let’s highlight how to use a check stub generator to make check stubs that accurately match your pay period. The pillars of the discussion are accuracy, format, and professionalism.
What Does a Pay Stub Represent?
A pay stub document gives a reflection of the pay for a particular time period. It shows the gross earnings and how they are reduced to net pay after taxes and deductions are taken out. It is accompanied by paper checks or a record of the payment electronically. This is proof of income for the time period stated on the pay stub.
In some parts of America, it is a legal requirement for employers to give pay stubs to their employees. It is a common document produced by payroll departments, even if it’s not mandated. Banks and government agencies rely on it to verify a person’s income.
What is a Pay Period?
Each check stub has a corresponding pay period. Pay periods affect how check stubs calculate taxes and deductions. If the pay period is wrong, the pay stub numbers will not match the payroll and the bank deposit record.
The most common extremes for pay periods are weekly, biweekly, semi-monthly, and monthly. This directly impacts the calculation of work hours and the deductions. Different pay periods also affect free time and work time for salaried employees. Pay periods also affect the division of salary.
Information on a Check Stub
There are some things that all check stubs have. It explains the origin and destination of the money.
These things are:
- ➡ Employee info
- ➡ Employer info
- ➡ Pay period
- ➡ Gross pay
- ➡ Taxes
- ➡ Pay after deductions
If it’s incomplete or inconsistent, the check stub is considered incomplete and possibly void. Although a paycheck stub maker organizes everything into a template, the final stub is only as good as the input data.
Gross Pay Calculations Based on Pay Period
Gross pay is the total earnings before any deductions. Corporations use the wage or salary system for their employees.
A person paid hourly is compensated for the number of hours worked each day for every pay period. If the company is a weekly payer, then the workers receive up to 40 hours of pay. In a bi-weekly system, employees are paid for up to 80 hours. Extra work hours are compensated with overtime pay.
A salaried worker receives a guaranteed amount of their annual pay by pay period. If the employer is paying monthly, it means it is 1/12 of their salary annually. In a bi-weekly one, however, employees receive 1/26th of their annual salary. If you’re messing up the pay period or pay frequency, your check stub builders cannot figure gross pay properly.
Tax and Withholding in Different Periods
Withholding taxes depend on the pay period, not the year. For every period, 3 taxes are deducted based on the earnings for that period: Federal, Social Security, and Medicare. Some state and local taxes may apply.
If the income stays the same, shorter pay periods will always result in smaller withholding amounts. Conversely, in longer pay periods, each stub will have larger deductions. While making a check stub, the amount of withholding should align with the length of the pay period. Check stubs get challenged because of wrong withholding.
Benefit and Non-Tax Deductions
Workers pay some deductions from their pay. These include either insurance premiums, retirement contributions, or wage garnishments.
Some deductions are applied to every pay period, while others apply once per month. A check stub should be accurate. If a monthly deduction is repeated on every weekly stub, then the record is inaccurate.
How to Make Check Stubs That Match Your Pay Schedule?
When making check stubs, dates, payments, and deductions need to connect to the same pay period. Find a pay period and stick to it. Payments must only reflect work done in the specific time span. Deductions reflect what was actually taken out. The net pay has to align with what was paid out.
These mistakes usually occur when users have to guess pay periods or use copy stubs to fill in the amounts without changing the dates. Using a check stub maker can help with the structure, but it will not address poor logic.
Using the Pay Period as a Reference
The most common pay stub issues stem from: missing or wrong pay period dates, gross pay not reflecting hours worked or salaries grossed, missing or wrong tax deductions, duplicate or incorrect deductions, and net pay not matching bank deposits. These issues stem from the same common denominator. You should have a payment period and use it as a constant reference.
Check Stub Generator Tools Overview
Traditional employees use check stubs to check their pay and to keep a record of their pay history. When independent contractors need to document their income, check stub records are a good choice. Small business owners use check stubs to make payroll records without complicated systems.
In these situations, a pay stub maker is a documentation tool. But it is not a substitute for real accounting. Accuracy is the responsibility of the user. Most stubs are digital today and come in PDF form. Saving check stubs digitally and accessing them later is easier than accessing a printed version.
The check stub should represent real income. Fabricating or overstating your income is illegal and can create real issues. Making stubs clear to read is the goal, not to confuse or mislead anyone.
Bottom Line!
A pay stub is true only for the period of time it has been written for. The revenues, taxes, and deductions are determined during this time. So when you’re trying to learn how to generate check stubs, the most important thing to pay attention to is the pay period alignment.
While you can use a pay stub generator to help get everything in one place, that is not the proof of worthiness of the stub, but rather knowing when the pay period falls. As long as the pay periods, earnings, and deductions match, check stubs work as wage receipts.
