How Much Is Taken Out of My Paycheck in SC?
Gain clarity on your South Carolina paycheck. Understand the essential deductions that shape your net income and how to interpret your pay stub.
A paycheck details gross earnings and various deductions. Understanding these deductions is important for managing personal finances, as each amount withheld contributes to federal and state obligations or personal benefits.
Federal Payroll Withholdings
Federal payroll withholdings are the largest portion of deductions, funding government programs. Federal income tax is one such deduction, with the amount withheld determined by the employee’s W-4 form. This form provides employers with information about an individual’s tax situation, including filing status and adjustments for dependents or other income sources. The federal income tax system operates on a progressive scale, taxing higher incomes at higher rates.
Beyond federal income tax, employees contribute to Social Security and Medicare, collectively known as Federal Insurance Contributions Act (FICA) taxes. For 2025, the Social Security tax rate is 6.2% of gross wages for employees, applied to earnings up to a wage base limit of $176,100. The Medicare tax rate is 1.45% of all gross wages, with no wage base limit. An additional Medicare tax of 0.9% applies to wages exceeding $200,000 for single filers and $250,000 for those married filing jointly.
South Carolina State Withholdings
South Carolina imposes a state income tax on residents’ earnings, using a progressive structure. For 2025, state income tax rates range from 0.00% to 6.2%. The top marginal rate will decrease to 6% effective July 1, 2025. The amount withheld depends on an employee’s income and allowances claimed on their state withholding form.
South Carolina’s unemployment insurance program is funded by employer taxes, not employee contributions. Employers pay state and federal unemployment taxes to support benefits for eligible laid-off workers. Therefore, employees in South Carolina do not see deductions for state unemployment insurance.
Voluntary and Involuntary Deductions
Beyond mandatory taxes, paychecks include voluntary or involuntary deductions. Voluntary deductions are authorized by an employee, often for benefits or savings. Common pre-tax voluntary deductions include health, dental, or vision insurance premiums, and contributions to retirement accounts like a 401(k), HSAs, and FSAs. These pre-tax deductions reduce taxable income, potentially lowering tax liability.
Other voluntary deductions are taken post-tax, after taxes have been calculated. Examples include Roth 401(k) contributions, group life insurance premiums, union dues, or charitable contributions. These amounts do not reduce taxable income but affect net pay.
Involuntary deductions, or garnishments, are legally mandated withholdings from an employee’s pay. These occur due to court orders or legal requirements. Common reasons include court-ordered child support, alimony, defaulted student loans, or tax levies. Employers must comply, deducting specified amounts from gross pay before net pay is determined.
Navigating Your Pay Stub
Understanding your pay stub is important for managing personal finances. A pay stub details earnings and deductions for a specific pay period. Gross pay is the total amount earned before deductions. Net pay is the remaining amount after all deductions are subtracted.
Deductions are itemized and often abbreviated. Examples include “FIT” for Federal Income Tax, “SS” for Social Security, “MED” for Medicare, and “SCIT” for South Carolina State Income Tax. Voluntary deductions may appear as “401K” or “HI” for Health Insurance. Regularly reviewing your pay stub helps verify that the correct amounts are being withheld for taxes, benefits, and other deductions. This practice helps ensure accuracy and allows for prompt identification of any discrepancies.