Payroll Glossary

Take-Home Pay

In the context of federal tax levies, take-home pay is the amount of an employee's wages that remains after all normal deductions in effect at the time the levy was received.

Tip Credit

This is a reduction in the minimum wage allowed for tipped employees, authorized by the provision in the Fair Labor Standards Act allowing employees to take a credit against their minimum wage obligations for tips received.

Tipped Employee

A tipped employee is one who is engaged in an occupation in which he or she customarily and regularly receives more than $30 per month in tips.

Transmittal of Wage and Tax Statements

Employers submitting W-2s on paper must also file Form W-3, which requires the employer to provide composite information pertaining to the batch of W-2s being filed.