Do you have to tax a bonus? What is the tax on a Christmas bonus?

Answer 1

Yes, all income is taxable. Typically, there is a different rate for a one-time bonus. You can check with the person who prepares payroll for your company. They can advise you on the exact amount which will be withheld. However, many smaller companies do not differentiate between regular earnings and bonus and may treat them all the same. There isn't a huge difference, however, between the two rates.

Answer 2

If the bonus is cash or similar to cash (like a gift certificate to a supermarket), it's considered income and taxed. As everyone has stated, small bonuses generally get added to the paycheck and taxed at whatever rate the withholding tables show. Large bonuses often get taxed at a flat 25% (I always preferred the latter), an approach that was added after companies discovered employees were trying to turn in -4s for the bonus only.

Deminis gifts (the Christmas "turkey" worth less than $25) isn't taxed. And yes, I know a $10 check will feel like it is "deminis" but it is income.

Answer 3

A bonus is taxed just like any other income, so the income tax is whatever your rate is. Social security and medicare are withheld also.

Answer 4

Christmas bonus is taxed at the same rate as the payroll and income tax is withheld. FICA is also withheld if your earnings are not over the maximum subject to FICA.

Answer 5

Actually, the disability and 401k are for your benefit for future retirement and you hopefully will eventually get those back. Social Security and Medicare go to support people already collecting those benefits. NYS and Fed withholding go to cover your income tax bill when you file your tax returns. So, sorry, it is correct. If your employer wanted you to get a check that was an actual $100 amount, he or she would need to pay your closer to $200.

Answer 6

Not sure where you live,but in some countries it is taxed