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The company gives you ten skittles as a bonus but the government initially takes 4 of them for taxes but your true taxes were only 2 skittles so you get 2 skittles back when you file your taxes.
👏a👏ma👏zing👏
Adding to SC1, if you don’t want them to take 4 skittles initially you can adjust your withholding profile (exemptions) so the automatic system doesn’t calculate the withholding of 4
Good point. That makes sense
Look at your taxes for for the whole years and don’t worry about bonus vs regular comp. you may want to adjust withholding if the bonus withholding rate is significantly different than your normal withholding rate.
It boils down to the bonus is usually withheld at 22 percent. Your regular earnings are withheld at a rate based on your W4. At the end of the year they will be taxed at the same rate. The bonus could cause you to be over or under withheld.
I’m pretty sure I do like 0 or 1 withholdings, should I change that before my bonus? I understand the govt takes taxes and I eventually get them back but
You should have at least 1
anyone at EY know how to change this? I cant find or figure it out lol
Go to your paystub on better you. Somewhere on that page is a link to withholding or W4