Gross vs. Net Income refers to the difference between total earnings before deductions (gross) and the amount remaining after taxes and expenses (net) for individuals or businesses.
- What is the difference between gross and net income?
Answer: Gross is total earnings, while net is after taxes and deductions. - What deductions affect the transition?
Answer: Deductions include taxes, insurance, and retirement contributions. - Why is this distinction important?
Answer: It affects budgeting, tax planning, and employee paychecks. - How is it reported?
Answer: Gross is on W-2, while net is on pay stubs. - What role does HR play?
Answer: HR ensures accurate calculation and communication.
