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saba999
May 20, 2013, 01:12 PM
What should be withheld from a bonus in the year it is paid?

In my opinion only FICA and FIT should be withheld.Am I right or no?

ebaines
May 20, 2013, 01:56 PM
FICA, federal and state/local income tax should be withheld, and depending on corporate policy you may also have a 401(k) contribution automatically taken out as well.

saba999
May 20, 2013, 03:22 PM
Will FUTA be withheld?

ebaines
May 28, 2013, 01:11 PM
Will FUTA be withheld?

FUTA (Federal Unemployment Tax Act) is paid only by the employer, not the emoloyer, so no, FUTA is not withheld from the bonus. And given that FUTA applies only to an employee's first $7K in earnings for the year the employer would have to pay FUTA on the bonus only if the employee has not reached this level of earnings for the year.