Annual Salary

• Your salary is what you receive in dollar earnings over the course of a week, month or year. Most people refer to salary in annual terms; for example, a person might say, "I earn $60,000 a year" instead of "I earn $5,000 per month." This is your gross -- meaning pretax -- salary. Your employer will deduct certain mandatory expenses from every paycheck. Federal and state taxes, Social Security and Medicare contributions, retirement contributions, and your share of health insurance premiums are common paycheck deductions.
  
  

Remuneration

• Your remuneration is your total compensation, which includes salary and the dollar value of all the benefits you receive as an employee. For example, the total annual cost of your health insurance is part of your remuneration. If you receive higher education benefits like tuition reimbursement, that's part of your remuneration as well. Employer contributions to sponsored retirement plans are included, as are employer-sponsored childcare programs. These benefits can cost employers several thousand dollars every year.
  
  

Taxable Benefits

• Some of these benefits are taxed by the federal government and possibly your state government if you pay state income tax. Health insurance premium payments come out of your paycheck after taxes. Sometimes, the cost of a benefit is added to your W-2 at the end of the year. For example, if your employer is paying the cost for you to attend college, that tuition will probably be added to your annual earnings; you may have to pay income taxes on that amount. Other benefits, like contributions to an employer-sponsored retirement plan like a 401k, come out of your paycheck pretax. That's one reason why the 401k is a huge employee benefit.
  
  

When You're Self-Employed

• When you're self-employed, your earnings are paid to you in cash and reported on a 1099, your remuneration and your annual salary may be the same thing. At tax time, you'll need to report your gross earnings to the Internal Revenue Service and possibly your state government. You'll need to plan to pay income tax on these earnings. Speak to a tax professional who's licensed in your state to determine how to best plan for these taxes. You also may find a way to increase your remuneration through smart planning.