What are pre-tax deductions?…?

April 6th, 2010

i was looking online at my paycheck and when i looked at the taxes being taken out one of them said "pre-tax deductions" and i think there was a 2% next to it? what is that? im guessing its taking 2% of my paycheck out, but what is it for? j/w any advice would be nice ! thanks :)

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  1. mel - April 6th, 2010 at 2:37 pm

    some employers take off the medical portion of your deductions BEFORE they are taxed, so you are taxed less.

  2. *LiLy* - April 6th, 2010 at 2:37 pm

    I’m not sure but I get 5% pre tax deductions for my 401k …maybe it’s the same for you, or some pension…or something like that.

  3. Olegious - April 6th, 2010 at 2:37 pm

    You would have to speak to your HR about what the deductions actually are, but pre-tax deductions are deducted before taxes are calculated, thus lowering the amount of taxes that are taken out of your check.

  4. Scott K - April 6th, 2010 at 2:37 pm

    Pre-tax deductions are tax deferred deductions from your gross pay. Examples are cafeteria plan items (group health, life, d&d, prepaid legal, etc.,) 401(k) contributions, MHS contributions, etc. Either FICA/income taxes aren’t taken on that deferred income.

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