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re: Adjusting tax withholding for annual bonus
Posted on 12/15/14 at 5:02 pm to LSU6262
Posted on 12/15/14 at 5:02 pm to LSU6262
Income is income is income. You aren't going to pay a higher or lower percentage of taxes just because it is a bonus.
If your salary is $100,000 per year and you know you'll get 25,000 at the end of the year, adjust your withholdings accordingly.
To answer your question, it doesn't matter. There isn't a way to game the system that I know about.
If your salary is $100,000 per year and you know you'll get 25,000 at the end of the year, adjust your withholdings accordingly.
To answer your question, it doesn't matter. There isn't a way to game the system that I know about.
2
Posted on 12/15/14 at 6:55 pm to I Love Bama
quote:
it doesn't matter
Withholding is higher on a "bonus" thanks to Bill Clinton punishing the rich people. When you figure the taxes at the end of the year it will all be figured at yoy regular tax rate.If you do nothing you are making the gvt a tax free loan for over a year. I claim an extra exemption or 2 all year so that doesnt happen.
Posted on 12/15/14 at 11:08 pm to I Love Bama
quote:
If your salary is $100,000 per year and you know you'll get 25,000 at the end of the year, adjust your withholdings accordingly.
Your company is suppose to do this. Basically, at $100,000, you're probably in the 25% bracket (unless you have a spouse making a lot of money) and 6% state. You're also looking at approx. 7.5% FICA, etc. So, they should withhold about 38.5% from any bonus.
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