Year end Company bonus tax rate?

08mojo · Dec 18, 2018

Zemedici said:
59.5% of something is better than 100% of nothing

I hear you, but I still can't fall in line with that mentality. Not saying this is you, but I really think people should be able to take home their entire paycheck. Then once a year (hell, even twice or quarterly) have to stroke a gigantic check to taxes. That would really change people's opinion on their take home pay.

Too many have become complacent by ignoring their gross salary and being happy with the net. It's just as bad as looking at the monthly, 96 month payment, on a truck they really can't afford.

Malern28us · Dec 18, 2018

I know it sucks but if it makes you feel any better my dad makes $1200 a month from social security and $600 a month from his job (He is 71) and he still pays taxes and they take out Medicare premiums...
I think taxes are a major screwing regardless of the rate you are taxed at.

FJohnny · Dec 18, 2018

I hope your government is more careful spending your hard earned money than ours is with Canadian tax dollars. They can't be worse, that's for sure.

I hear you guys are going to build some big border fences. I recently read that this year so far we have had 26,250 illegal immigrants, primarily from Somalia, Haiti and Nigeria slip into Canada over our south border. If you guys have any say in it could you maybe do the north fences first? We are having trouble figuring out what to do with these people.

Thanks and all the best.

DSG2003Mach1 · Dec 18, 2018

my bonus got taxed roughly 6.25% higher than my normal paycheck.

I’m thrilled to get it but still sucks to see that big ass chunk gone

Zemedici · Dec 18, 2018

08mojo said:
I hear you, but I still can't fall in line with that mentality. Not saying this is you, but I really think people should be able to take home their entire paycheck. Then once a year (hell, even twice or quarterly) have to stroke a gigantic check to taxes. That would really change people's opinion on their take home pay.

Too many have become complacent by ignoring their gross salary and being happy with the net. It's just as bad as looking at the monthly, 96 month payment, on a truck they really can't afford.

This country is the greatest one on earth, you would agree yes?

taxes (to me) are a necessary evil. They will never go anywhere. I will GLADLY pay taxes to be able to experience the great opportunity that is the United States. *Bald Eagle Screams*

whereas other countries literally tell you what profession you're going to work in / have caste systems / etc etc

I'll take it. Not really an alternative is there?

[bcolor=transparent]

FJohnny said:
I hope your government is more careful spending your hard earned money than ours is with Canadian tax dollars. They can't be worse, that's for sure.[/bcolor]
[bcolor=transparent][/bcolor]
[bcolor=transparent]I hear you guys are going to build some big border fences. I recently read that this year so far we have had 26,250 illegal immigrants, primarily from Somalia, Haiti and Nigeria slip into Canada over our south border. If you guys have any say in it could you maybe do the north fences first? We are having trouble figuring out what to do with these people.[/bcolor]
[bcolor=transparent][/bcolor]
[bcolor=transparent]Thanks and all the best.

[/bcolor]
[bcolor=transparent][/bcolor]
[bcolor=transparent]ahhh but see our issues stem from the southern border[/bcolor]
[bcolor=transparent][/bcolor]
[bcolor=transparent]So we wall our southern border[/bcolor]
[bcolor=transparent][/bcolor]
[bcolor=transparent]shouldn't you as well?

use some of those tax dollars! [/bcolor]

08mojo · Dec 18, 2018

Zemedici said:
This country is the greatest one on earth, you would agree yes?

taxes (to me) are a necessary evil. They will never go anywhere. I will GLADLY pay taxes to be able to experience the great opportunity that is the United States. *Bald Eagle Screams*

whereas other countries literally tell you what profession you're going to work in / have caste systems / etc etc

I'll take it. Not really an alternative is there?

While I've never lived in another country, I agree this one is definitely at the top of my list of the greatest. I just wish I had more say as to where my taxes go, who qualifies for what programs, and getting the government to spend within their (our) means. It warms my heart to see a portion of my taxes go to those who are truly in need and towards programs that are beneficial to all. At the same time, it infuriates me to see people habitually abuse the system and live life on the hard work of others.

Zemedici · Dec 18, 2018

08mojo said:
I've never lived in another country, I agree this one is definitely at the top of my list of the greatest. I just wish I had more say as to where my taxes go, who qualifies for what programs, and getting the government to spend within their (our) means. It warms my heart to see a portion of my taxes go to those who are truly in need and towards programs that are beneficial to all. At the same time, it infuriates me to see people habitually abuse the system and live life on the hard work of others.

I completely agree there, wish we could control where the taxes go, but then how could Uncle Sam mismanage our money as well as they do?!

08mojo · Dec 18, 2018

Zemedici said:
I completely agree there, wish we could control where the taxes go, but then how could Uncle Sam mismanage our money as well as they do?!

And this is why it stings a bit more than the usual paycheck. The bonus us meant for me to enjoy or use to it's full benefit--it's just that: a bonus above and beyond my normal pay. Greedy Sam comes in and says, "hey, I see you got some unplanned money. Give me 40% and GFY."

JPKII · Dec 18, 2018

I get my year-end on Thursday. Can't wait to see how much I give up. I worked my ass off for that money and to see 40%+ taken off the top for the fed and whatever else the state steals from me; well it makes me sick.

sleek98 · Dec 18, 2018

I am a cpa and deal with this a lot.

Your normal check is withheld at a lower rate because it is over withholding you at the start of the year. Correct in the middle of the year then under withholding you at the end of the year.

We have a progressive tax scale. (Making up the dollar amounts in brackets to make the math easier.) Your first 10k is taxed at 10% then the next 20k at 12% the next 50k at 22%. Next 70k at 24% next 50 at 32%.

To make your take home pay even they withhold at the effective rate (total tax vs total income) vs the marginal rate (tax on each additional dollar earned)

Since the bonus is a one time event they take it at 25% since it’s being added to you marginal rate at the end of the year. If you only make 25k taxable a year they end up way over withholding since your marginal rate will be 12% and you get it back at the end of the year. If you make 200k your bonus ends up under withheld and you owe the difference at the end of the year.

25% bonus rate 7.65% fica and 6% Missouri rates. Gets you to 38.65% real quick.

It really sucks for people in nyc. It’s closer to 55% after the city tax and higher state tax

IA Shelby · Dec 18, 2018

COOL COBRA said:
I guess I shouldn't complain, but damn! 40.5% tax rate on a bonus seems pretty steep to me.
I pay out upper 30% all year on salary allready.
I dread to think what those thousands of dollars out of my pocket actually went to support.
I'm pouring another shot of bourbon. Pondering on it.

Doug

That is what is withheld upfront. Depends on where your total taxable comp comes in at year end and where your marginal tax rate sits. Regardless it will be less than 40%. You are still getting screwed, just not as bad as it what it looks like at the moment.

Coiled03 · Dec 18, 2018

sleek98 said:
I am a cpa and deal with this a lot.

Your normal check is withheld at a lower rate because it is over withholding you at the start of the year. Correct in the middle of the year then under withholding you at the end of the year.

We have a progressive tax scale. (Making up the dollar amounts in brackets to make the math easier.) Your first 10k is taxed at 10% then the next 20k at 12% the next 50k at 22%. Next 70k at 24% next 50 at 32%.

To make your take home pay even they withhold at the effective rate (total tax vs total income) vs the marginal rate (tax on each additional dollar earned)

Since the bonus is a one time event they take it at 25% since it’s being added to you marginal rate at the end of the year. If you only make 25k taxable a year they end up way over withholding since your marginal rate will be 12% and you get it back at the end of the year. If you make 200k your bonus ends up under withheld and you owe the difference at the end of the year.

25% bonus rate 7.65% fica and 6% Missouri rates. Gets you to 38.65% real quick.

It really sucks for people in nyc. It’s closer to 55% after the city tax and higher state tax

Thanks for the explanation. It still sucks, and it's still bullshit.

sleek98 · Dec 18, 2018

Coiled03 said:
Thanks for the explanation. It still sucks, and it's still bullshit.

It’s a real kick in the nuts, even I get pissy about my bonus. It is masked by the lower rate through out the year.

People would be really made if they withheld you at your actual rates through out the year. Lots of income in the start and not much at the end.

DaleM · Dec 18, 2018

SID297 said:
Shit like that is why I'm thinking of moving to Puerto Rico.

Panama is where it rocks for retirement and taxes.

OK Bozos, stop clowning around.

SID297 · Dec 18, 2018

DaleM said:
Panama is where it rocks for retirement and taxes.

OK Bozos, stop clowning around.

I like having an American flag in the court room.

COOL COBRA · Dec 18, 2018

IA Shelby said:
Doug

That is what is withheld upfront. Depends on where your total taxable comp comes in at year end and where your marginal tax rate sits. Regardless it will be less than 40%. You are still getting screwed, just not as bad as it what it looks like at the moment.

Well, I guess less screwed is better than fully screwed! What's a guy to do? Oh, I know, go back to work, make more money, pay more taxes. Lol.

DSG2003Mach1 · Dec 18, 2018

so glad we don't have state income tax

Stateguy · Dec 18, 2018

I just contribute 100% of my bonus to my 401k

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tistan · Dec 19, 2018

COOL COBRA said:
Keyword some. I allready get screwed because I refuse to "cheat" on taxes. I've seen the results of that over the years from co-workers thinking they had it all figured out. Long story short, the IRS don't play.
Being said, my bonus will add to my year end total income. Just got smacked with 40.5% on that, and will pay about 38% on my annual income also.
America I guess. As it is now.

The way I look at it is the people not cheating will get audited before me.

Coiled03 · Dec 19, 2018

COOL COBRA said:
I guess I shouldn't complain, but damn! 40.5% tax rate on a bonus seems pretty steep to me.
I pay out upper 30% all year on salary allready.
I dread to think what those thousands of dollars out of my pocket actually went to support.
I'm pouring another shot of bourbon. Pondering on it.

I've always thought the key isn't to make more money, but to minimize how much you give to the government. The tax code screams that you should be a business owner, and write everything off. But, in order to do that, you still have to pay the money upfront, in order to write it off later. It's a struggle, and I hate it. But hey, 'Merica, right?

Year end Company bonus tax rate?

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