Do what I do and change your Federal withholding to exempt. Then change it back

Sign up, and you'll be able to customize your font size and more! Sign up

Report problem with this ad

Feb 15, 2024
7:58:16pm

Jeff Spicoli All-American

Do what I do and change your Federal withholding to exempt. Then change it back

to normal for your regular paychecks.

Report problem with this ad

Jeff Spicoli

Bio page: Jeff Spicoli
Joined: Feb 13, 2004
Last login: Sep 7, 2024
Total posts: 35,779 (201 FO)

Report problem with this ad

Messages

Author

Time

Are company annual bonuses taxed at the same rate as bi-monthly paychecks?

BleedCougarBlue2

Feb 15, 7:08pm

No, withholding is at a much higher rate, at least in my experience

AZ Coug

Feb 15, 7:08pm

That’s just the withholding. When you file the return, the income is taxed the

allaboutthegainz

Feb 15, 7:10pm

which is why I said withholding

AZ Coug

Feb 15, 7:11pm

BleedCougar asked if it’s taxed the same. You said no. It’s taxed the same.

allaboutthegainz

Feb 15, 7:12pm

So they withhold it at a certain % rate (which can be higher than your

BleedCougarBlue2

Feb 15, 7:25pm

Right. You got it. I know that there’s a way around it because my employer

allaboutthegainz

Feb 15, 7:27pm

If you adjust your w-4 accordingly it works out and you can end up owing the IRS by the end of the year,

Baron

Feb 15, 7:34pm

W-4: I prefer to not give the IRS an interest-free loan all year long. Just

BleedCougarBlue2

Feb 15, 7:42pm

again, just reduce the withholding accordingly and it will be fine and you will end up owing money.

Baron

Feb 15, 7:44pm

Literally not a screw job.

RGGeemer

Feb 15, 7:47pm

All income taxes are a screw job

AZ Coug

Feb 15, 9:38pm

It’s all dependent on the software/setup.

kjjson

Feb 15, 8:14pm

But you also said “no”

Incentivize

Feb 15, 9:18pm

Yes. The withholding is just higher.

allaboutthegainz

Feb 15, 7:09pm

It’s counted as income. But not taxed any differently during your tax return

Powerbait DPM

Feb 15, 7:10pm

I usually get taxed at about 45% when I get a bonus. Highway robbery.

KingDave

Feb 15, 7:10pm

You have money withheld at that rate. Not taxed.

kccougar

Feb 15, 7:17pm

They tax it with your standard set of deductions

webster242

Feb 15, 7:10pm

The tax rate is the same, but usually they'll withhold an automatic 22%

Feb 15, 7:10pm

Won't get a refund. Double-edged sword there....

BleedCougarBlue2

Feb 15, 7:13pm

You will owe less than if they withheld less from your bonus though.

RGGeemer

Feb 15, 7:39pm

Yep, this is true. Guess I should focus on that in an effort to be positive.

BleedCougarBlue2

Feb 15, 7:50pm

This particular kind of pay happens every year at the same time. Blessed

BleedCougarBlue2

Feb 15, 7:18pm

Withholding is not the same as taxation.

kccougar

Feb 15, 7:16pm

I've argued about this sort of thing so often that I won't add to it

Belboz

Feb 15, 7:19pm

Taxes are the same

JOPE

Feb 15, 7:24pm

It is taxed the same come tax day. Withholding depends on your company and how

RGGeemer

Feb 15, 7:37pm

No. My bonus is withheld a SIGNIFICANTLY lower % than my paycheck

fulano

Feb 15, 7:38pm

I disagree with the advice above. I think it’s likely they are ripping you off.

TCuz

Feb 15, 7:48pm

And I think it's highly likely you are an arrogant jerk.

BleedCougarBlue2

Feb 15, 7:53pm

Nice flex

JimmyZ

Feb 15, 7:50pm

Do what I do and change your Federal withholding to exempt. Then change it back

Feb 15, 7:58pm

Woah. Is that ethical?

TNT

Feb 15, 8:48pm

The IRS taxes as if it is your new salary.

Florwood

Feb 15, 7:59pm

The irs has nothing to do with the withholding. It's all your employer.

RGGeemer

Feb 15, 11:27pm

You know you can get it some of it back when you file your taxes correctly.

Feb 15, 8:00pm

Criminal when it is severance pay

Florwood

Feb 15, 8:04pm

Yeah, I get that. But the other option is to change your withholding, so that

Feb 15, 8:16pm

Report problem with this ad

Posting on CougarBoard

In order to post, you will need to either sign up or log in.

Report problem with this ad