Try this on minimizing taxes:
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Yes, but you can reach out to the payroll/accounting and adjust the sum taken out
The math is messed up - when they cut that check they make an assumption that you'll be making the same amount every two weeks, so, multiply that with 24, it's a ton of money which puts you in the highest tax bracket (depending on your tax situation, for the federal tax, it'll probably be 33%, 35% or 39.5%)
The same applies for your state, in Cali, it'll likely put you to 10% state tax bracket, so do your math, that's at least 45% right there, add local taxes, Soc Sec, etc. It's easily over 50%
Yes, it's true. But (depending on your tax situation) you'll more than likely get a large refund next year.
If they haven't paid out yet, try contacting HR to see if you can change your W4 withholding for this payout. You can claim up to 9 and that would reduce the amount paid for taxes. I would prefer to have more of my money up front than have Uncle Sam holding on to it until next year
true. in CA everything beyond your income paycheck is taxed at the supplemental rate. When you file your taxes it all gets added as income and increases your tax rate because you get bumped up to higher tax bracket :(
It doesn't matter at the end of year.
You get more taxed now (on bonus), but at the end everything you earned is just taxed normal acc. to your eventual/effective fed/state tax rates. i.e. taxes on X bonus dollars = taxes on X dollars normal wage income. Just that Uncle sam takes a additive cut immediately on the former.