pretax deductions
Before-tax payroll reductions
Pretax deductions are amounts subtracted from an employee's gross pay before taxes are calculated, reducing taxable income.
Common examples include contributions to retirement accounts, health insurance premiums, and flexible spending accounts: Her pretax deductions for the 401(k) lowered her tax burden significantly.
The benefit is immediate tax savings, though some deductions may be taxed later upon withdrawal.
- paycheckCompensation for labor
- pay stubEarnings and deductions summary
- withholdingKeeping from another
- 401kEmployer-sponsored retirement savings
- benefitsGains or helpful effects
health insurance · healthcare · premiums · FSA · flexible spending · dependent care · gross · net · net pay · salary · contributions · retirement · retirement plan · insurance · exemptions · allowances · payroll · earnings