What term describes income left after taxes and deductions?

What term describes income left after taxes and deductions?

• A. Net pay
• B. Compensation
• C. W2
• D. Termination

Answer: (A)

Net pay is the income you actually receive after taxes and other deductions are taken out. It’s what you take home for spending. For example, if your gross pay is $3,000 and $700 is deducted for taxes and benefits, your net pay is $2,300. Take-home pay is another common way to say this. Compensation describes the total earnings before deductions, including salary or wages and benefits, so it’s not the amount left after deductions. A W2 is a tax form that reports earnings for the year, not the amount you receive in a paycheck. Termination refers to ending employment, which is unrelated to how much money you take home.

Net pay is the income you actually receive after taxes and other deductions are taken out. It’s what you take home for spending. For example, if your gross pay is $3,000 and $700 is deducted for taxes and benefits, your net pay is $2,300. Take-home pay is another common way to say this.

Compensation describes the total earnings before deductions, including salary or wages and benefits, so it’s not the amount left after deductions. A W2 is a tax form that reports earnings for the year, not the amount you receive in a paycheck. Termination refers to ending employment, which is unrelated to how much money you take home.