as well as the 401K amt?
2007-08-06 13:18:32 · 10 answers · asked by Tiff 2 in Business & Finance ➔ Taxes ➔ Other - Taxes
It's not only legal, but required under federal law. Any income you receive from an employer as a wage or bonus will be taxed SS and Medicare up to the maximum limit, which is $97,500 for 2007. Any amount you have directed to be invested in your 401K is irrelevant, other than that the 401K amount should not be taxed. That's a pretax investment.
2007-08-06 13:23:00 · answer #1 · answered by acermill 7 · 2⤊ 0⤋
sure it's legal to take ss tax out of bonus checks, call it salary or call it bonus it's still taxable wages subject to social security. The only time social security wouldn't be taken out of a bonus is if the person was already at the social security limit for the year. And 401k amount being taken out is perfectly fine as well.
2007-08-06 15:12:21 · answer #2 · answered by Anonymous · 1⤊ 0⤋
If you are an employee, your employer has to take out social security taxes. You cannot get paid as an employee and contract labor for the same job. Your 401k I have no idea. . .
2007-08-06 14:38:09 · answer #3 · answered by towanda 7 · 0⤊ 0⤋
It's not only legal, but required, that they take out the social security. As to the 401K, you've directed them to take out a certain amount from each paycheck, and a bonus check is a paycheck, so yes they would normally take it out - that's actually to your advantage.
2007-08-07 04:00:28 · answer #4 · answered by Judy 7 · 2⤊ 0⤋
It's not only legal, it's required on the SS and Med taxes. It's not specific to TX, as those are Federal taxes.
The 401(k) amount depends upon the plan. Mine allows me to specify a higher % from bonuses if I choose but it has to be at least the same as my regular pay.
2007-08-06 14:42:14 · answer #5 · answered by Bostonian In MO 7 · 2⤊ 0⤋
She could be searching for a diverse activity. This organisation sounds like they are approximately to circulate decrease than. NO it is not criminal for them to easily withhold extra beneficial despite in the event that they actually DID deliver it to the IRS - and from the way that they had one tale, then yet another, i'd wager the possibilities of that being actual are incredibly low. The would have had to pay some thing extra beneficial to the IRS for their taxes yet i'd be genuine taken aback in the event that they paid it as extra beneficial withholding for their workers. She could call her state hard paintings branch and checklist that she wasn't paid what became by way of her. yet while the individuals merely have not got the money, that may not get the money on your mom.
2016-12-15 07:39:54 · answer #6 · answered by ? 4 · 0⤊ 0⤋
Yes. Bonuses are taxable just like any other income. If you have a designated percentage going in to your 401k, then they will automatically withhold the 401k amount, too.
2007-08-06 13:23:00 · answer #7 · answered by crazydave 7 · 2⤊ 0⤋
social security comes out of any and all kinds of pay until you reach the 97500 YTD limit, then just the 1.45% medicare tax comes out. If you were getting 401k out of your regular pay and the company policy is to deduct 401k contrib on bonus payments, then the company is correct - there is nothing illegal here
2007-08-06 13:54:11 · answer #8 · answered by Anonymous · 2⤊ 0⤋
They are required to do so. A bonus is regular income for tax purposes, so a percentage of it is taxed, taken out for Social Security, and applied to you 401(k).
2007-08-06 13:39:35 · answer #9 · answered by mcmufin 6 · 2⤊ 0⤋
Yes it is. Bonuses and commissions are considered part of your salary.
2007-08-06 13:21:31 · answer #10 · answered by TedEx 7 · 2⤊ 0⤋