@hn Hope for 10/30 or 11/30.
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@hj darn. Well, I’m hoping to get laid off and call it a career. Will look at current 401k doc.
I do know that if over 55 (retirement eligible), the LTI used to get paid out when you retire, but now you have to be employed sept 1 to get it.
@hh The 401k match policy changed so now you must be employed on the final business day of the year in order to get it. It's unclear if you would get a prorated match if you were to be laid off.
I view front loading your 401k as a bit of a risk now, since if your employment ends before the year is done then you lose your match. You'd also be unable to contribute to your new employer's 401k plan since you already hit the cap earlier so you'll miss out on any potential match from your new employer.
Front load 401k. Up to 75% both regular and bonus paycheck. Reduce taxable income reduces remaining bonus tax hit.
Or just get the money back when do taxes next year.
Best to front load 401k and HSA to max so to hit max early. Then you get full 401k match next year even if canned.
Bonuses are withheld at a higher rate (typically a flat 22% federal rate) because the IRS classifies them as "supplemental income" rather than regular salary. This ensures enough tax is prepaid to cover higher marginal brackets, preventing you from owing a large balance at tax time. Any over-withholding is returned as a refund when you file.
@gc IRS and whatever state requirements.
Mine has almost always worked out to be about 35% taken out of the bonus. This is federal/state and Medicare, etc..
@dh that seems to be BS. If I am exempt, I am exempt. Is.the a bank thing or IRS thing?
@dh The person who said 40% was probably including FICO/medicare and state/local taxes. You are correct that the federal withholding is 22%.
Paid in 6th as off-cycle.
Bonus is actually taxed at 22% initially. But the other information below is correct, when you file your taxes it'll be straightened out to be in line with your overall tax rate.
Bonuses are taxed at 40%. If that is higher than your tax rate you will get it back when you file taxes
I claim exempt. Will this still apply,.the exempt part and nothing taken out?
@cx Bonuses are taxed as supplemental wages, typically with a 22% federal withholding rate for amounts up to $1 million.
@cx why
@c3 I believe they are required to deduct more.
Same tax deducted as normal check?
They're paid out on the 6th.