2006-07-13 07:03:22 · 2 answers · asked by luda 1 in Business & Finance ➔ Taxes ➔ United States
I am a salaried + commission employee and my commission is tax as a bonus. I would like to know if that the correct tax deduction.
2006-07-13 07:10:19 · update #1
Yes, it is one of the two correct ways to WITHHOLD tax on commissions. The other way is to include the commissions in your paycheck and tax you as if you would receive the same amount each pay period (i.e. pushing you into higher tax brackets). The withholding method is designed to make sure that nonperiodic payments such as bonuses and commissions have adequate tax withheld.
When you actually file your tax returns, there is no difference in how salary and commissions are taxed. Your tax will be calculated and your withholdings will be used to offset your tax liability. Any excess or shortage will lead to a tax refund or balance due.
2006-07-15 12:30:08 · answer #1 · answered by taxmannyc 3 · 1⤊ 0⤋
I wouldn't trust any answers on this forum that could land you in jail, go see a tax pro.
2006-07-26 12:01:05 · answer #2 · answered by nocateman 5 · 0⤊ 0⤋