Once I got my first “real” job, (meaning not a lemonade stand on a random sidewalk) I eagerly awaited my first paycheck.
Finally, payday arrived. I quickly tore open the envelope and scanned to see how much money I made. Satisfied at the thought of serious cash, I made a deposit to my checking account
But there was a lot more in that envelope than I first realized. My pay-stub (the paper that’s attached to the actual check) had lines and lines of numbers and all sorts of information. Some of it made sense, some of it didn’t, but I was really only concerned with whether I got my money or not.
But after a while, I realized that it’d be a good idea to understand what money I wasn’t receiving, not just how much I made.
Taxes:
Since I’m 17, I figured that the government didn’t give a shit about my money. But I guess they figured out that my money spends just like everyone else’s and so they take some of my money for taxes. Yes, taxes, as in more than one. There are actually different types of taxes. You will most likely see the following kinds of listed:
SOC (might be called OASDI) is payment into the Social Security System. This is a public insurance program that actually includes many different services. These include:
- unemployment benefits
- Medicaid
- Medicare
- supplemental security income
- health insurance for children
This tax is how welfare is made possible. Also, when you retire and get “old” at 65, you can receive payments every month from the government as part of your retirement.
FEDWI- Stands for Federal Withholding. These are simply taxes paid to the federal government. This money could go to a number of different places-defense, highways, etc.
STATE- (My paystub says “OH”, yours will obviously be different if you don’t live/work in Ohio.) These are taxes paid to the state. These are used for things like roads, state parks, state police, etc. Some states do not have an income tax.
CITY- I don’t pay city taxes since I work at a shopping mall in the country, but I have a friend who works in the city, and her paycheck has another line that reads “CITY” and a few more dollars are taken out for city taxes. Her place of work is actually only a mile or two from mine, so I just barely escaped them.
The good news that you can get part of these taxes back. If you earn less than a certain amount (around $8,000), the government will refund you the money taken for federal taxes for free.
These are the main types of deductions that could affect how much money you actually get to take home. There are other possible reasons why you might receive less money than you planned, but if you’re just working a simple part time job, these are the ones you should pay attention to.
