Deductions are items that lower your taxable income, thus lowering your tax liability. Common itemized deductions are health care costs, retirement account contributions, and job-related expenses.

Deductions can also be post-tax. These deductions do not lower your tax liability, but instead are taken out of your paycheck once your taxes have been calculated. Common examples are life insurance and short-term disability.

To check whether a deduction on your paycheck is pre- or post-tax, check with your payroll or HR manager.

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