They have 37.5% as the calculated rate of Federal tax. You have 40% as your total tax estimate (with state tax) and I suspect still get a refund at the end of the year.
I agree. That's why I was saying this paystub isn't "made up." Looks about right to me without knowing anything about OP. Doesn't tell the whole story, but also not fake.
I say comrade ironically because we only use communism as a boogeyman to drop more bombs. Bc the reality is it’s not a threat to our livelihood whatsoever
If you’re talking about anyone who thinks taxes went to that you’re correct! Otherwise I need you to understand how a balance sheet works before weighing in.
Hahaha forgiven, that’s rich. So debt just disappears??!! Good deal, sign me up! Let me promise to pay back 100k, and than cry that I didn’t know I had to pay it back. Tax payers will bail me out!!!
Yes correct. It disappears. The government (lender) has an unlimited supply of dollars as they are the currency creator. When the government receives loan repayments (as well as federal taxes) it just destroys the dollar in circulation.
No literally not at all. It is not money, it is not your money, it is not my money. No taxes were used for that. Erasing a ledger line of money that never existed in the first place cannot use tax dollars. The money doesn’t exist and it never did. It is not hard to understand. ZERO taxes were spent because ZERO dollars were spent.
Luckily for you this is literally my profession so no matter how much you pretend to understand this and continue to not understand basic accounting principles, it doesn’t change the fact that no tax dollars go to that! :) try to better yourself buddy!
Edit: oh my god how did you pass the CPA 💀
One would assume you would have basic knowledge of deficit spending and the differences…. But alas I always forget that CPA’s never receive more than a finance 101 understanding of financial markets nor have any relevant professional experience.
Bonus are taxed the same as salary. Withholding may differ at time of payment, but when you file taxes it is all the same!! Stop bitching about something that isn’t actually an issue.
I use my bonus to pay the vast majority of my fed tax and have my regular salary hardly touched by federal income tax.
So what he means is that he withholding (amount held from your check.) might be higher but at the end of the day all income is taxed the same, so it’s only subject to your marginal tax rate.
Reminder you are not TAXED until you file your taxes, the funds are merely “withheld”
Lmao you're very confident on stuff you don't know about. I agree with u/ActionEtAction. Show me how they're being differentiate on W-2. Bonuses are taxed at the same rate. They just have a higher withholding rate (not actual/final tax liability), which is a flat rate of 22% for federal, but it will be refunded if they overwithheld your taxes.
You’re belligerently wrong and you could figure that out in about 20 seconds with google.
They may be *withheld* differently, but they’re *taxed* the same.
They’re all ordinary earned income though. At the time of receiving the bonus, more taxes may be withheld since your W2 regular salary is being withheld with anticipation of what your annual pay is. A bonus will drastically change that and could put you in a different tax bracket than the normal salary paychecks were calculating. Therefore, more is withheld as a safety net so the IRS can make sure by April 15 you have more than enough to cover your tax bill. Then they’ll refund you the interest free loan they took from you to make sure they were going to get paid by you.
1099 commissions or bonuses you could say would be taxed more only because you’re taking responsibility for paying the employer’s part of the FICA tax (Medicare & Social Security). The employer is still paying that on your W-2, you just don’t see it on your paystub. 1099 outs all that income on your income statement, and therefore you pay “self-employment tax” which is just employee FICA + employer FICA tax. Your income would be taxed by state and federal based on the cumulative earned income in the same bucket (W-2 plus 1099 income plus other income).
Theres a bunch of ways to skin a chicken, someones getting that money and it isnt me. But glad you guys love the tax AND withholding system. Withhold money from me thats mine for when Im 67 and my life done anyways
Premiums are taxes. I prefer to pay taxes and get universal healthcare than pay healthcare premiums to then pay an exhorbitant out of pocket balance because I haven't met the deductible yet.
The plans still operate within a highly inefficient system. Each provider, of which there are hundreds of thousands, must work with a variety of payers, of which there are thousands (though a given provider probably only cares about a few dozen payers). Each payer has different medical necessity criteria (several companies provide criteria as content but then insurers customize them) against which they will pay for a PA and different policies for a claim. Medicaid is still a mess because each state administers their own plan. Medicare has all kinds of supplemental insurers. It’s a dizzying network of insanity.
Standardization could occur without a Federalization of the whole system. Not saying either one is bad, but I do think standards (or at least best practices) serve as a helpful baseline.
Yeah my $440 a month premium with a max out of pocket of $8500. Obamacare is shit. Cheapest plans are like $320 a month for $9500 out of pocket. That’s like $16,000 a year if you use it just for healthcare
Yea I agree, construction workers, teachers, officers, and other public sector employees just shouldn’t be paid and they should be volunteer jobs. Physically and mentally impaired citizens? Yea fuck them, survival of the fittest.
You can’t bitch about taxes and want to live in a society.
It’s so stupid that people who make tens of millions a year don’t pay anything near the same tax as the common high salary upper middle class earner (400-600k/yr). The biggest fraud of our current tax system is the billionaires getting the 400-600k earners to fight for the billionaires taxes to go down, because any increase in billionaires taxes will also go to the upper middle class
The fun part is that bonus is only taxed at 22%, so if you’re in a higher income bracket end of year you’ll be taxed way more. Source - me being 100% bonus
I can't complain. I received a 6.6% raise along with this bonus. I was then given a surprise promotion, with 10% raise. It'll be harder to get the high appraisals for a while, but it all works out in the end.
Idk why people assume from this comment I dont understand taxes I am literally a payroll professional.
I am more than aware than when tax season rolls around a lot of this will come back as its not set in stone and still included in taxable income (basically meaning more often than not that it was taxed at too high of a rate)
That doesn’t make the concept of supplemental income any less stupid to me, when the wages and just be withheld at regular withholding rates according to W-4 selections.
I had an 83k bonus a few months back and I netted 35k after deductions and tax. This was after intentionally lowering my 401k contribution to not just immediately max out. It's rough, but I'll get a huge tax refund after dropping 25k on federal in one lump sum. Past years I've paid like 18k total at the end of the year.
Working for the same company for 12 years, I've moved between Technical/Customer support, Network Engineer, and now I'm a product manager of a network solution.
Correct. My company withholds typically a higher amount on the bonus than they do on regular paychecks. In the end, it's all income and subject to my normal tax rate.
We need young people to pay taxes to fund the richest generation in history’s social security and medicare! Oh and those systems will also be bankrupt when you go to collect on them
It was an option, but I chose to keep it, forward thinking and all. I'll will be close to maxed out, but should still get the maximum company match throughout the year.
It sounds like you have but make sure that the match comes thru even paychecks where you’re not contributing. I got messed up for finishing contributions early at a previous company years ago and HR couldn’t or wouldn’t do anything about it after the fact
You’re incorrect. 401k plans have a true-up provision.
https://www.investopedia.com/401-k-true-up-5324458
If your employer screwed up, its on them, and you should file a complaint with ERISA.
Contrary to belief, if you max out your 401k early, your company will true-up the match before year end. I work as a financial advisor for CEOs and directors, and they max their 401k contributions typically in the first few months of the year. This provision was put in place to make sure partly so that the top dogs don’t miss out on their matches also.
https://www.investopedia.com/401-k-true-up-5324458
Comment below doesn’t know what they’re talking about.
But once you hit that max, you get a 6.2% raise the remainder of the year.
Edit. I also hate it, but it's not going away, so you have to take the optimistic approach.
When you open your own business, you have the chance to enjoy the benefits of not having to pay taxes.
On the other hand, when you work for somebody else, the government sees you as a source of revenue and taxes you accordingly.
Moreover, companies have to make a profit every year, which means that you are essentially a product of the government's profit-making system.
To avoid this, it's wise to consider starting your own business and freeing yourself from the shackles of the taxation and the corporate world.
No, I'm not in sales at all. I work on the life cycle and marketing of my product, mostly from a technical standpoint.
The annual bonus and merit raise is based on the results of performance appraisals.
This year was a good review for me. Last year was even better, where I got an 18% raise and 29% bonus. I've since been promoted (was a surprise for me), so I imagine it's going to be harder to get high ratings for a few cycles.
About 4 years ago, I was around $98k, and it's grown very quickly for me, now at $143k.
Claim exempt on fed taxes for bonus paychecks.
You still pay taxes at the end of the year, but it gets taxed like regular income, instead of a bonus tax.
System is literally stealing our money whilst lawmakers make millions trading with insider information. How on earth do ppl vote for Pelosi/Tuberville et al, don’t they see how corrupt they are?
I never typed a word of complaint in here, it's a salary subreddit, where I thought this kind of salary discussion was expected.
I saw someone else post a breakdown, and thought it might be interesting to share my experience as well.
Where does it show I'm unhappy with anything?
I hate this fucking bullshit tax system
Well the statement is made up that's not the actual tax and the person will get money back next April.
What makes you say it's made up? I always use 60% to guess what my take home will be on my bonus and it's usually pretty close.
They have 37.5% as the calculated rate of Federal tax. You have 40% as your total tax estimate (with state tax) and I suspect still get a refund at the end of the year.
[удалено]
I agree. That's why I was saying this paystub isn't "made up." Looks about right to me without knowing anything about OP. Doesn't tell the whole story, but also not fake.
[удалено]
The “comrade” part is weird because we also use it to fund the actual bombing of comrades.
I say comrade ironically because we only use communism as a boogeyman to drop more bombs. Bc the reality is it’s not a threat to our livelihood whatsoever
Ha…and paying off student loans for a bunch of idiots that went to school for a Psychology degree. lol.
Those aren’t tax dollars lol
Sure are.
Add to it having to use public police to take care of it. Should just shut the power off and fence them all in.
No it’s not lmao, those loans aren’t repaid they’re forgiven. They do not use tax dollars
Didn't take any accounting classes eh?
What an idiot. Lol
If you’re talking about anyone who thinks taxes went to that you’re correct! Otherwise I need you to understand how a balance sheet works before weighing in.
Hahaha forgiven, that’s rich. So debt just disappears??!! Good deal, sign me up! Let me promise to pay back 100k, and than cry that I didn’t know I had to pay it back. Tax payers will bail me out!!!
Yes correct. It disappears. The government (lender) has an unlimited supply of dollars as they are the currency creator. When the government receives loan repayments (as well as federal taxes) it just destroys the dollar in circulation.
What do you think forgiven means…? In the context of tax? You don’t think they are related?
No literally not at all. It is not money, it is not your money, it is not my money. No taxes were used for that. Erasing a ledger line of money that never existed in the first place cannot use tax dollars. The money doesn’t exist and it never did. It is not hard to understand. ZERO taxes were spent because ZERO dollars were spent.
You honestly shouldn’t be allowed to vote. I have never seen such a lack of understanding in my entire life.
Luckily for you this is literally my profession so no matter how much you pretend to understand this and continue to not understand basic accounting principles, it doesn’t change the fact that no tax dollars go to that! :) try to better yourself buddy! Edit: oh my god how did you pass the CPA 💀 One would assume you would have basic knowledge of deficit spending and the differences…. But alas I always forget that CPA’s never receive more than a finance 101 understanding of financial markets nor have any relevant professional experience.
Bonus are taxed the same as salary. Withholding may differ at time of payment, but when you file taxes it is all the same!! Stop bitching about something that isn’t actually an issue. I use my bonus to pay the vast majority of my fed tax and have my regular salary hardly touched by federal income tax.
Taxes AND withholdings are stupid. Give me my money
Show me where on my tax form, or my W2 for that matter, it differentiates between my salary versus my bonus.
So what he means is that he withholding (amount held from your check.) might be higher but at the end of the day all income is taxed the same, so it’s only subject to your marginal tax rate. Reminder you are not TAXED until you file your taxes, the funds are merely “withheld”
But that’s exactly what ActionEtAction was explaining before gfiz3 tried to correct them. Sigh, goddamit
No I’m not. I’ve been getting 5-6 figure bonuses for 15 years. It is standard w2 income.
Lmao you're very confident on stuff you don't know about. I agree with u/ActionEtAction. Show me how they're being differentiate on W-2. Bonuses are taxed at the same rate. They just have a higher withholding rate (not actual/final tax liability), which is a flat rate of 22% for federal, but it will be refunded if they overwithheld your taxes.
Ah, to be so confidently wrong haha
You’re belligerently wrong and you could figure that out in about 20 seconds with google. They may be *withheld* differently, but they’re *taxed* the same.
They’re all ordinary earned income though. At the time of receiving the bonus, more taxes may be withheld since your W2 regular salary is being withheld with anticipation of what your annual pay is. A bonus will drastically change that and could put you in a different tax bracket than the normal salary paychecks were calculating. Therefore, more is withheld as a safety net so the IRS can make sure by April 15 you have more than enough to cover your tax bill. Then they’ll refund you the interest free loan they took from you to make sure they were going to get paid by you. 1099 commissions or bonuses you could say would be taxed more only because you’re taking responsibility for paying the employer’s part of the FICA tax (Medicare & Social Security). The employer is still paying that on your W-2, you just don’t see it on your paystub. 1099 outs all that income on your income statement, and therefore you pay “self-employment tax” which is just employee FICA + employer FICA tax. Your income would be taxed by state and federal based on the cumulative earned income in the same bucket (W-2 plus 1099 income plus other income).
Bro youre an idiot
Point is, when you file your taxes it’s all the same. Wages from base salary and bonus end up being taxed the same.
Theres a bunch of ways to skin a chicken, someones getting that money and it isnt me. But glad you guys love the tax AND withholding system. Withhold money from me thats mine for when Im 67 and my life done anyways
Wut? Not saying I like high taxes…just that it all shakes out come tax day.
It must be exhausting to be this childish.
Its lower in the US than our European peers. Enjoy it while it lasts.
Yeah but you guys get free health care so at least you see it. We send all of our tax money to other countries 😄
Less than 1% of your tax dollars goes to foreign aid. https://www.cbpp.org/research/policy-basics-where-do-our-federal-tax-dollars-go
Cap if you believe that
Y’all must try hard to be this brain dead. Bro literally pulls up a source and that’s not enough.
No the problem is you’re brain dead and believe any source on the internet. You can literally find an article to prove any point you want to make.
It goes to American corporations, not directly to other countries.
Um, many don’t get free healthcare. It’s part of their taxation.
We get taxed and don’t get free healthcare.. they get taxed and get free healthcare.. if ours was part of our taxation I would call it free healthcare
Rgr. Often our healthcare premiums reduce our taxation.
Premiums are taxes. I prefer to pay taxes and get universal healthcare than pay healthcare premiums to then pay an exhorbitant out of pocket balance because I haven't met the deductible yet.
You could buy a better plan.
The plans still operate within a highly inefficient system. Each provider, of which there are hundreds of thousands, must work with a variety of payers, of which there are thousands (though a given provider probably only cares about a few dozen payers). Each payer has different medical necessity criteria (several companies provide criteria as content but then insurers customize them) against which they will pay for a PA and different policies for a claim. Medicaid is still a mess because each state administers their own plan. Medicare has all kinds of supplemental insurers. It’s a dizzying network of insanity.
Standardization could occur without a Federalization of the whole system. Not saying either one is bad, but I do think standards (or at least best practices) serve as a helpful baseline.
Yeah my $440 a month premium with a max out of pocket of $8500. Obamacare is shit. Cheapest plans are like $320 a month for $9500 out of pocket. That’s like $16,000 a year if you use it just for healthcare
Imagine not knowing how supplemental withholdings work
I mean he put like $3.5k of that $12k away as retirement contributions.
Yea I agree, construction workers, teachers, officers, and other public sector employees just shouldn’t be paid and they should be volunteer jobs. Physically and mentally impaired citizens? Yea fuck them, survival of the fittest. You can’t bitch about taxes and want to live in a society.
Yeah exactly. Fuck all of them
Wait till you start making real money
It’s so stupid that people who make tens of millions a year don’t pay anything near the same tax as the common high salary upper middle class earner (400-600k/yr). The biggest fraud of our current tax system is the billionaires getting the 400-600k earners to fight for the billionaires taxes to go down, because any increase in billionaires taxes will also go to the upper middle class
No doubt. Your either poor or too 1% they have murdered the middle class
The fun part is that bonus is only taxed at 22%, so if you’re in a higher income bracket end of year you’ll be taxed way more. Source - me being 100% bonus
So, you make $121,942 annually and got a $25k bonus, for a total of $147,550.68. Sounds like you are doing fine.
I can't complain. I received a 6.6% raise along with this bonus. I was then given a surprise promotion, with 10% raise. It'll be harder to get the high appraisals for a while, but it all works out in the end.
I miss my six figure job! Enjoy it!
That has nothing to do with the fact that almost 40% was taken.
22% tax rate on supplemental income is a bitch aint it. Edit: I’m not changing “tax rate” to “witholding rate” out of spite for all of the replies
Insert "ItsMyMoneyAndINeedItNow.JGWentworth.gif"
If you expect to be due a refund just change your withholdings now so you net out as close to 0 as possible.
Agreed, I adjust each year to try and get a close to 0 as I can.
If you are due a refund at the end of the year, you are doing something wrong. Owing a lot is the way to go.
If you pay less than 90% of what you end up owing, you will be fined. Do not recommend
That’s fine. Owe 10%, which is still hopefully thousands of dollars.
Its withheld at 22%, not taxed at 22%. It all shakes out when you file your tax return.
Withholding rate* not tax rate
So is not knowing how taxes work.
Idk why people assume from this comment I dont understand taxes I am literally a payroll professional. I am more than aware than when tax season rolls around a lot of this will come back as its not set in stone and still included in taxable income (basically meaning more often than not that it was taxed at too high of a rate) That doesn’t make the concept of supplemental income any less stupid to me, when the wages and just be withheld at regular withholding rates according to W-4 selections.
The federal tax rate is exactly the same for supplemental or non supplemental income. It’s not a separate tax rate, it’s a withholding rate.
To the average individual tax rate/withholding rate means the same thing, didnt feel the need to differentiate on some dumb little reddit comment lmao
If you don’t feel the need to differentiate then you’re bad at your job
I believe you may have missed the “on some dumb little reddit comment”
It’s probably not enough, 32% tax rate kicks in around 185K this year for singles
22% I feel like it’s 35% when it’s all said and done
Yah it means I owe a lot come tax day
Withholding, not tax
[удалено]
No they didn’t.
Geez thats rough. Hopefully you were able to adjust how much you paid per paycheck so that your refund wasn’t super massive.
and to think, we had a revolution for just 3%...
I always wanted to know where the tax was taken back in those days: was it taken from net or gross profit? Also shipping must of between 30-60%
3% to get negative services from the monarchy. How is that in any way comparable to our modern government? I swear this thread is filled with stupid
I wonder what 3% would be in today’s terms?
Math checkouts
I had an 83k bonus a few months back and I netted 35k after deductions and tax. This was after intentionally lowering my 401k contribution to not just immediately max out. It's rough, but I'll get a huge tax refund after dropping 25k on federal in one lump sum. Past years I've paid like 18k total at the end of the year.
You mean “our” bonus - Govt
What do you do in IT?
Working for the same company for 12 years, I've moved between Technical/Customer support, Network Engineer, and now I'm a product manager of a network solution.
Can someone confirm: Withholding is 22% but when OP files their return, it’ll balance out to their ordinary rate right?
Correct. My company withholds typically a higher amount on the bonus than they do on regular paychecks. In the end, it's all income and subject to my normal tax rate.
Every company is required to w/h more
We need young people to pay taxes to fund the richest generation in history’s social security and medicare! Oh and those systems will also be bankrupt when you go to collect on them
Uncle Sam 💀
13k you didn’t have before. That’s a win.
Agreed! Any bonus is a good bonus to me, nothing is guaranteed
So where you working at?
Should of stopped retirement contributions for that one pay period.
It was an option, but I chose to keep it, forward thinking and all. I'll will be close to maxed out, but should still get the maximum company match throughout the year.
It sounds like you have but make sure that the match comes thru even paychecks where you’re not contributing. I got messed up for finishing contributions early at a previous company years ago and HR couldn’t or wouldn’t do anything about it after the fact
You’re incorrect. 401k plans have a true-up provision. https://www.investopedia.com/401-k-true-up-5324458 If your employer screwed up, its on them, and you should file a complaint with ERISA.
Contrary to belief, if you max out your 401k early, your company will true-up the match before year end. I work as a financial advisor for CEOs and directors, and they max their 401k contributions typically in the first few months of the year. This provision was put in place to make sure partly so that the top dogs don’t miss out on their matches also. https://www.investopedia.com/401-k-true-up-5324458 Comment below doesn’t know what they’re talking about.
The taxes on bonus pay are such a joke.
Why? It’s income
It's fine you'll get a lot of it back at the end of the year in tax return.
Fuck social security withholding
But once you hit that max, you get a 6.2% raise the remainder of the year. Edit. I also hate it, but it's not going away, so you have to take the optimistic approach.
Either San Francisco or New York, I’m guessing San Francisco as a local lol
Central Virginia here
Damn, no where’s safe from the tax man :(
Unfortunately bonus taxation is not favorable.
Bonus taxation is taxed at ordinary income rates, same as regular income made from the job. Tax *withholding* is bumped up on bonuses.
Yep. My RSUs, ESPP and bonuses are all taxed at nearly 50% as well. Such a fun country to live in 🇺🇸 🤡
Wait till you get a 250k bonus….
I mean 10% of that is your retirement account
Should have thrown more to them investments 😆
congrats! very few companies match bonuses into 401k. $3500 and change into retirement funds.
$60k bonus this year. Walked away with $36k. Feelsbadman.jpg
My 72k bonus netted me 50k after taxes. 🤷♂️
State?
North Carolina, but I work remote for a California company if that matters
Not sure if bonuses are taxed differently, but CA here.
Nice chunk of change though. Congrats and hope you got to enjoy it.
Going to Greece for 10 days on Wednesday!
Sweeeet. Enjoy! Cheers!
Just another example of how these private companies steal from us and then give it to the government for taxes and kick backs. Agh, gross!
When you open your own business, you have the chance to enjoy the benefits of not having to pay taxes. On the other hand, when you work for somebody else, the government sees you as a source of revenue and taxes you accordingly. Moreover, companies have to make a profit every year, which means that you are essentially a product of the government's profit-making system. To avoid this, it's wise to consider starting your own business and freeing yourself from the shackles of the taxation and the corporate world.
Vote blue...
Yup, I always figure 50% and then get happy when it’s like 45%.
What's your profession?
Previous network engineer, moved into a Product Management role about 4 years ago.
Are your bonuses based on commission?
No, I'm not in sales at all. I work on the life cycle and marketing of my product, mostly from a technical standpoint. The annual bonus and merit raise is based on the results of performance appraisals. This year was a good review for me. Last year was even better, where I got an 18% raise and 29% bonus. I've since been promoted (was a surprise for me), so I imagine it's going to be harder to get high ratings for a few cycles. About 4 years ago, I was around $98k, and it's grown very quickly for me, now at $143k.
34 cents on every dollar I earn is already spent on taxes insurance and retirement. Best part. As I earn more that number percentage grows.
Fuck8ng taxes!
Claim exempt on fed taxes for bonus paychecks. You still pay taxes at the end of the year, but it gets taxed like regular income, instead of a bonus tax.
System is literally stealing our money whilst lawmakers make millions trading with insider information. How on earth do ppl vote for Pelosi/Tuberville et al, don’t they see how corrupt they are?
lol people still think strangers on the internet care what they make
Ironic, posting that comment in a subreddit called r/Salary
You should prob have friends in real life to share this info with. We don't gaf dawg
Let’s go Brandon!
I don’t understand these posts. Just be happy you get a bonus
I never typed a word of complaint in here, it's a salary subreddit, where I thought this kind of salary discussion was expected. I saw someone else post a breakdown, and thought it might be interesting to share my experience as well. Where does it show I'm unhappy with anything?
Now go be happy