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    Deepika_kandukoori's Avatar
    Deepika_kandukoori Posts: 2, Reputation: 1
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    #1

    Mar 12, 2007, 02:25 PM
    Tax on Sign-on Incentive and Relocation Incentive
    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
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #2

    Mar 15, 2007, 10:43 AM
    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.
    Deepika_kandukoori's Avatar
    Deepika_kandukoori Posts: 2, Reputation: 1
    New Member
    		  
    #3

    Mar 20, 2007, 03:09 PM
    Quote 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.
    Thank you very much.
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #4

    Mar 22, 2007, 09:49 AM
    Glad to help!
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