Hi,

I got a job offer in Phoenix, Arizona, with a sign-on 'Incentive' of $30,000 and a relocation Incentive of $3,000 for.

1. What will be percentage of tax on these two kinds of incentives? And how much can I expect after taxes?
2. What if I break the contract? Do I need to even pay the deduted taxes to the company? If yes, can I claim it back in tax-returns filing?
3. They used the word Sign-on incentive... how it is different from sign-on bonus.

Your advice will be greatly appreciated.

Thanks in advance.

Dee

1) These bonuses will probably WITHHOLD taxes at 30%. How much you actually PAY in taxes depends on your TOTAL income.

2) If you break the contract, you probably will have to return a portion of the bonus. That will result in a proprotionate reduction in wages for that year's W-2.

3) Different word; same result.

Quote:

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Originally Posted by AtlantaTaxExpert

1) These bonuses will probably WITHHOLD taxes at 30%. How much you actually PAY in taxes depends on your TOTAL income.

2) If you break the contract, you probably will have to return a portion of the bonus. That will result in a proprotionate reduction in wages for that year's W-2.

3) Different word; same result.

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Thank you very much.

Glad to help!