I owe a lot in taxes this year and I’m surprised. I expected a refund bc I assumed taxes on bonus would be withheld at a very high flat rate. I checked Reddit and there were so many ppl saying they got a huge refund this year. Anyone in the opposite situation? Was taxed at third year income if that helps.

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Withholding on bonuses is different from regular salary and employers have a few options to handle it. Sounds like they withheld at the 22% and now you'll have to pay the difference. Just gotta plan for it.

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If you don’t want to owe every year, you need to adjust your W-4 to take out extra from your paychecks. Otherwise you’ll always owe because our bonuses are under withheld (as others have said)

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This. I opted for additional withholdings on my W-4 after my 2nd tax year in Big Law.

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Your effective tax rate is now above 22%. That’s all this means.

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IRS says the "standard" withhold on bonuses in 22%. My firm (and suspect others) allow us to inform HR in advance if we want taxes witheld at a higher rate.

If you made more money this year than last (and therefore still had more taxes withheld then you paid last year) you may still be subject to IRS safe harbor rules where tou owe money but don't owe any interest or penalty. Honestly that is the BEST situation to be in. However, when you cut your withholding too tight you run the risk you may be hit with penalties

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I think I always just assumed my employer was withholding the correct amount. I’ve literally never been hit with a penalty before

IME bonuses are usually underwithheld.

What’s that old joke? “I’d want only a republican to do my taxes, but only a democrat to make my coffee.”

It’s worth a discussion with a tax professional about how to best structure these things when you’re a high-income W2 wage earner.

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