Here is a quick synopsis of the tax withholding that you may see on your pay stub.
Federal income tax withheld (FITW): This tax is withheld based on the way you complete your W-4 form. The more allowances you claim, the less tax that is withheld. If you claim zero allowances, you will have the maximum withholding. The marital status that you indicate in box 3 also determines the amount withheld—“single” has a higher rate of withholding than “married.” The Federal Income Tax that is withheld over the course of the calendar year is reported to you on your W-2 form.
Social Security tax (FICA): This tax is withheld at a rate of 6.2% of your applicable gross earnings, up to the point that you earn $87,000 in 2003. Once this threshold is attained, no further FICA withholdings will occur in 2003. Student employees are exempt from this tax for the quarters in which they are actually enrolled for at least half-time. It is uncommon for students to have FICA taxes withheld during the school year, but quite common during the summer. Payroll runs a report that indicates who is eligible for this exemption. If you think an error in your FICA withholding has occurred, please contact the Payroll Office.
Medicare tax: This tax follows the same rules as the Social Security Tax, but is withheld at a lower rate—1.45% of your applicable gross earnings. There is no maximum threshold for this tax.
Workers Compensation Tax (Wkrs Cmp): This tax is withheld based on the number of hours you work. The tax goes into an insurance fund that all employees pay into, so that in the event that you are injured while performing your job you can be compensated for medical expenses and lost wages.