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View Full Version : Sign-on bonus - taxes


lovedarain
May 3, 2006, 09:43 PM
I currently live and work in nyc and am considering taking a position with a company in New Jersey. They are offering me a sign-on bonus and I was curious what percentage I would need to pay in taxes and if that would be deducted up-front. Is a sign-on bonus treated the same as a "regular" bonus and taxed heavily? Any help you can provide would be greatly appreciated.

AtlantaTaxExpert
May 4, 2006, 08:38 AM
Any bonus is considered a part of your normal salary and will be taxed at your marginal tax rate.

Normally, the company withholds 30% of the bonus for income taxes, plus the normal withholding for Social Security (6.2%) and Medicare (1.45%), plus whatever is the norm for your state income tax withholding.