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View Full Version : Sign on bonus taxed 40%


hahnke1
Oct 8, 2007, 07:23 AM
Sign on bonus 4000.00. File single, 4 deductions. Received 2436.00 after taxes. Does this figure sound acurate? Thought withholding taxes would be a lot less and final bonus amount would be closer to 3000.00.

ScottGem
Oct 8, 2007, 07:47 AM
The problem here is that this amount was taxed based on your salary period. This is a frequent issue with lump sum payments. Lets say you get paid bi-monthly. The taxes would then be calculated based on a $72K annual salary (24 * $4K), so the withholding might be higher. But rememberthis is just withholding, you may get much of that back when you file your return.

AtlantaTaxExpert
Oct 9, 2007, 07:20 AM
Agreed!