Taxes/Bonuses

[mychelle 1]

i feel fortunate that my firm also included the amount taxed into our xmas bonus...although the bonus amount itself was not that great. =/ (do i sound ungrateful? hehe...)

they do take about half of the bonus amount...a few months ago we got a bonus for having a great fiscal year and i was so glad to see the amount they said we were getting...only to see that half of it went to taxes. i am SOOOO filing my taxes in January...and i have a dependent now.

[Jenn! 918]

Bonus? What's a bonus?????

Seriously. My company really needs to get on the ball.

[payxibka 10,048]

I think Yodrak is an accountant..............

Or maybe he just slept in a Holiday Inn Express last night.....

[kim&james 0]

James company gives half the bonus in Dec and the other half in Jan. This is in 2 seperate individual cheques. Still taxed pretty heavily... I just think it is wrong to tax a bonus...

[payxibka 10,048]

I just think it is wrong to tax a bonus...

Why? Earned income is earned income.....

If that were true then I would instruct my employer not to pay me a salary but give me my entire compensation paid to me as a bonus!

[Jasman0717 9]

I am in the 30% range and just hate April 15th every year

[payxibka 10,048]

I am in the 30% range and just hate April 15th every year

Combined state and federal?

[KarenCee 3]

Ok how is it that the gov't can take 1/4 of my bonus in federal taxes?????? This blows!

Welcome to America!

[irishgirl73 1]

I am not going to complain about being taxed on a Christmas bonus that my company didn't have to give me. It would have been nice if it weren't taxed but oh well..................it's better than what my last employer gave me...............NOTHING!!!!

[zyggy 9]

Ok how is it that the gov't can take 1/4 of my bonus in federal taxes?????? This blows!

It's the way their tax software works... they take that big lump sum payment, assume that's what you get all the time, apply it for the entire year and then calcualate what your tax rate would be...

If you want to stop that, you need to tell your HR person to up your deductions for the week that you get your bonus... or lower your witholding so that you get less taken out of your check during the year.

But don't worry.. you'll get it back from Uncle Sam when you send in your return...

[one...two...tree 2,762]

moody,

The government did not take 1/4 of your bonus, your company gave it to the government. The government will be happy to refund it to you if your company has over-withheld you.

Many companies' software bases the withholding amount on the annualized value of the current pay being taxed. When a bonus is thrown in on top of normal pay, the software does not recognize it as a one-time payment and sees you as having an annual income that is far larger than it will actually be, and calculates the withholding amount on the basis of that unusually large annual income.

Your complaint is with your company, not the government.

Yodrak

Ok how is it that the gov't can take 1/4 of my bonus in federal taxes?????? This blows!

I ran into same problem after being layed off from a studio. They owed me for 2 weeks vacation pay which I was counting on using for my mortgage at the time only to find out half of it was taken out for taxes. I ended up getting most of it back though when I filed my taxes.

[kim&james 0]

I just think it is wrong to tax a bonus...

Why? Earned income is earned income.....

If that were true then I would instruct my employer not to pay me a salary but give me my entire compensation paid to me as a bonus!

Im used to a bonus not being taxed... In Australia, for my taxes certain bonuses were not taxed including the christmas bonus, although are listed on payslips and the (W2) equilivent... As to whether or not they are taxed at tax time depends on your accountant.

[MichelleandCraig 1]

Ok how is it that the gov't can take 1/4 of my bonus in federal taxes?????? This blows!

It's the way their tax software works... they take that big lump sum payment, assume that's what you get all the time, apply it for the entire year and then calcualate what your tax rate would be...

If you want to stop that, you need to tell your HR person to up your deductions for the week that you get your bonus... or lower your witholding so that you get less taken out of your check during the year.

But don't worry.. you'll get it back from Uncle Sam when you send in your return...

Agreed. When our company let 1/2 of us go, and I got severance pay, that's what I did...upped my withholdings BIGTIME that week and I got a lot less taken out...it worked out, because I always get a refund. Well, maybe not this year now..not sure yet..but I did then anyway! M.

[w¡n9Nµ7 §£@¥€r 123]

I miss getting bonuses. This year we're on a salary-freeze.