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    gjack5404's Avatar
    gjack5404 Posts: 1, Reputation: 1
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    #1

    Jul 21, 2006, 02:26 PM
    Sign on Bonuses
    Our company gives sign on bonuses with the stipulation that the bonus does not have to be repaid if you work the 24 month commitment. The bonus is being written out of accounts payable and wages are not reported until the year of fullfillment. At that time the sign on bonus is "grossed up" for social security and medicare (which is essence, we are paying the employee share of SS and Mcare) and the gross amount is added to gross wages for the year. Should the bonus ( or do we have a choice) be reported in the year received regardless of the fullfillment period?

    Thank you
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
     
    #2

    Jul 25, 2006, 02:52 PM
    You can ALWAYS claim income in the year you received it, even if it is not reported on the W-2. However, you will probably have to get professional tax help to properly explain what you did in the year the income is reflected on your W-2.

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