Term | Definition |
biweekly | appearing or taking place every two weeks or twice a week |
dependent | a person who relies on another, especially a family member, for financial support. |
direct deposit | the electronic transfer of a payment directly from the account of the payer to the recipient's account |
earned income | money derived from paid work. |
employee | a person employed for wages or salary, especially at nonexecutive level |
employer | a person or organization that employs people |
exemptions | the process of exempting a person from paying taxes on a specified amount of income for themselves and their dependents. |
federal income tax | A tax levied by the United States Internal Revenue Service (IRS) on the annual earnings of individuals, corporations, trusts and other legal entities. |
FICA | Federal Insurance Contributions Act (FICA) tax /ˈfaɪkə/ is a United States federal payroll (or employment) tax imposed on both employees and employers to fund Social Security and Medicare—federal programs that provide benefits for retirees, the disabled, |
fringe benefits | an extra benefit supplementing an employee's salary, for example, a company car, subsidized meals, health insurance, etc |
gross income | Gross income is the starting point for determining Federal and state income tax of individuals, corporations, estates and trusts, whether resident or nonresident. |
hourly wage | describes a rate an employer agrees to pay a worker per hour worked, such as $12 per hour or $17.50 per hour. |
income tax | `tax levied by a government directly on income, especially an annual tax on personal income |
medicare tax | You must withhold Social Security and Medicare taxes--these are known as FICA (Federal Insurance Contributions Act) taxes. The FICA tax actually consists of two taxes: a 6.2 percent Social Security tax and a 1.45 percent Medicare tax |
net income | net income (net earnings, net profit, and informally, bottom line) is an entity's income minus cost of goods sold, expenses and taxes for an accounting period |
overtime pay | when and to the extent that they actually work more than 40 hours in a work week. FLSA overtime pay is time and one-half of the employee's regular rate of pay. |
profit sharing | a system in which the people who work for a company receive a direct share of the profits. |
salary | a system in which the people who work for a company receive a direct share of the profits. |
sales commissions | Some sales organizations pay a straight commission, meaning the salesperson's only income comes from sales commission. Others pay commission on top of a base salary or wage. The intent of commission is motivate the salesperson to sell more |
social security tax | The tax levied on both employers and employees used to fund the Social Security program. Social Security tax is usually collected in the form of payroll tax or self-employment tax. The Social Security tax pays for the retirement and disability benefits re |
tax deduction | A deduction from gross income that arises due to various types of expenses incurred by a taxpayer. |
tips | a sum of money given to someone as a reward for their services |
w2 form | a sum of money given to someone as a reward for their services |
w4 form | A form completed by an employee to indicate his or her tax situation (exemptions, status, etc.) to the employer. |
withholding allowance | Employee-claimed exemptions on the tax form employers use to determine how much of an employee's pay to subtract from his or her paycheck to remit to the tax authorities. |