I am expecting two checks in the mail in just a few days. One is a $30,000 sign-on bonus and the other is a $5,000 relocation bonus. When I get the checks, they'll already be taxed, so I was just wondering how much I'll get after Uncle Sam has taken his share...?
2007-06-25 14:54:50 · 2 answers · asked by Mary S 3 in Business & Finance ➔ Taxes ➔ United States
Irregular payments such as bonuses are withheld at a statutory rate of 25% unless you request a higher rate; you can't request less. The are also subject to FICA withholding. Based upon the numbers given, $8,750 will be withheld for Federal Income Tax plus $2,677.50 for FICA for a total of $11,427.50 leaving you with a net of $23,572.50
The actual tax due will depend upon your total income. You won't know that until tax time.
Since your employer is paying you a flat relocation bonus, you will be able to deduct your moving costs if your new job is at least 50 miles farther from your old address than your previous commuting distance was. So, if your previous commute was 25 miles, your new workplace must be at least 75 miles from your old home.
2007-06-25 22:47:48 · answer #1 · answered by Bostonian In MO 7 · 0⤊ 0⤋
Bonuses are usually taxed by Uncle Sam at 25% Plus SS/Medicare and state
2007-06-25 15:09:30 · answer #2 · answered by Mark S 5 · 0⤊ 0⤋