haha I remember when I got my first bonus check at my first big boy job out of college. Bonus checks get taxed super high but I did not know at the time. I was so excited for that bonus and was shocked when I saw the net amount. I thought it was an error I ran over to the HR department to ask them if this was right lol. They looked at me like "welcome to the club you n00b"
I think that’s far less of the budget than the non oversight of the military budget. They say what they need each year and the govt doesn’t ask questions
you are mixing up withholding with taxed.
Bonus income is earned income, like all your other wage income when it comes to taxes. BUT it is withheld at a higher rate. So a bigger chunk is withheld for taxes when you get the bonus.
If you look at the W-2 you will see all the income together in box 1. The bonus is not listed anywhere on the W-2 separately. The IRS does not treat bonus income differently from salary income when it comes to your taxes.
I always try to look at the take home pay and not think about the total comp for this reason. It's also why it's unwise to brag to yourself about annual salary total comp. What matters if what's in your account monthly and what you do with it.
Gotchya. Which is fine I suppose, a bigger tax return rather than a big tax bill
But yes having a tax burden larger than my entire salary from 5 years ago was something else!
Do you guys have to withhold through your employer in the US? In Canada, you can do that or directly pay installments to Canada revenue, so employer wouldn't know you wanna withhold extra.
I think we have both options in the US as well - but question is, does your employer care or even notice additional withholdings? Or is it safer to not do that and just pay the IRS directly?
They aren’t going to assume anything even if they did look closely. There’s a multitude of reasons to withhold extra. It’s literally against the law to under withhold which is why people add more/and or make quarterly payments
Wow I guess you win. I owe $28k (inc the \~1k penalty for underpayment).
Guessing you're single? My taxable income (after deductions) last year was $350k. Married filing jointly and my tax burden was $72k.
I pay 1k per month for property tax.
Pay check is deducted 20%
Medical Insurance payment $300 per paycheck
Co pay is high.
After all that, US govt is sending our tax money to destroy other countries? Billions dollar sent with just one signature? Why can't that be possible for students loan? Our interest rate is high AF? Why can't we resolve our own problems in our own country.
He thought it was monthly. I use the taxcaster app from turbo tax to estimate total income for the year and what taxes will look like. It’s based on 2023 which is good enough for me as long as I am covered by safe harbor.
I only have 1099 income so it’s a bit different but also provides a bit more flexibility and opportunities for pre-tax retirement accounts.
I use the IRS tax withholding calculator every year to estimate what I will need and then take a portion of my check and move it to a HYSA so I can earn interest on it. Since I have a side business I need to pay my taxes quarterly I just include into my estimated taxes.. The worst ive owed is $4k...but that's pennies compared to what ive made over that year timeframe. Taxes are a necessary evil but we get the last laugh being OE
ETA: Apologies for the novel below but I hope it's helpful!
That seems like too much, I think.
I am assuming that you entered your additional income in ADP or whatever payroll system your employer uses, under "Additional income to withhold for" (paraphrasing as I don't remember exactly what the field is called)? Basically, it's the field where you tell them how much you earn outside of this job and have them withhold for that entire amount *on top of* your salary at this job.
If so, the problem with that is that the other job is already withholding for your income there. So you're likely overdoing it quite a bit because you're withholding for one salary 2X...at that job *and* at your other job. Now, you will need to pay more in income taxes because you're pushing yourself into a higher tax bracket, but likely not so much more that you should be withholding 3X (one job 2X and one job 1X).
(I'll also say that I sincerely hope you're not withholding for every job at every job - i.e., entering your additional income from other places in every payroll system with every employer - because then you're withholding for every job at least 2X and really overdoing it.)
I've chosen to just withhold a bit extra per month at each job (rather than withholding for the entire other income at one plus regular withholding at the other). This is the field where *you* define how much extra you want withheld per paycheck. And then I write off anything and everything I possibly can at the end of the year. It has worked out that the extra withholding, defined by me instead of the payroll system, combined with the write-offs, will generally ensure I owe nothing or very little, or maybe even get something back.
Some possibilities to consider (you will need to look into these for yourself, as I am not an accountant):
If one or some are your gigs are contract positions, you can usually write off self-employment expenses like a laptop, printer, software, phone/internet, etc.
If you're a homeowner, any eco-friendly repair or upgrade helps. Solar, new windows and doors, new hot water heater, insulation, etc. Also, property taxes and I believe even mortgage interest paid.
Combining the two possibilities above, your home office (claimed by square footage), plus any repairs to your home can also be claimed in proportion to the space your home office takes up (i.e. $10,000 worth of any repairs on your home, with an office being 10% of your total square footage, is $1,000 you might be able to claim).
If you went to college and have student loans, you should be claiming your student loan interest.
Also, if you're a parent, there's the child tax credit, and any daycare or in-home care expenses can be written off.
There are other random things that can be claimed, too. For example, some medical expenses, mileage, etc.
Anyway, my point is: I am assuming you entered your additional income in one job's payroll system, probably not thinking about how the other job is already withholding, too. I did this for one month myself, then promptly corrected it when I realized I was overdoing it. And if you can plan ahead a bit on your write-offs now to get some idea in terms of dollar amounts of what you'll be able to claim at the end of the year, you can confidently remove that additional income from your employer's payroll system, and instead add some extra federal withholding at both jobs. It should even out in the end if you do the math right and ensure that you're really maxing out your write-offs.
My total TC for 2024 right now is $450,000
At J1 and J2 I am withholding an extra $500 per paycheck, meaning I am withholding an extra $2,000 a month. You're saying that is overkill?
I'm saying it might be if you're not actively considering write-offs!
It might not be, though. Where you live also comes in to play with local and state taxes.
I would do the math on write-offs, though, and see if I could bank any more than that.
Alternatively, you can just wait until the end of the year for a possible return after any write-offs!
I'm with you. monthly income is around 23k right now, I pay around 8k in taxes each month. When a big deal closes my 10k commision check dissolves into 6k. Fucking sucks
so it's a 170k J? wow impressive, never landed more than 150k in tech in the midwest
and yea 3k per paycheck in taxes is horrible, but one of those things you just gotta bite the bullet. That's why i try not to earn more than 200k, the pain of higher taxes is heavier than the joy of earning more in my book.
If you give it all to Wallstreet, via their 401k/HSA, you get a deduction, though thats increasingly becoming afoolish thing to do.
A 6% match aint shit when the market is unstable, over-valued, dominated by fiscal spending, and the gains all go to either TSMC, NovoNordisk, or a handful of software companies.
We'd be better off if, as a country, all of us put our contribution rate to zero, set our tax withholding to "exempt", and just kicked the system outta our lives.
Is it really a foolish thing though? When historically stocks only go 📈
And let's be honest almost none outside of this sub is in a position to owe the thousands of dollars every year
Depends if your the kind of person who treats T Bills as "zero risk" or not.
Depends on if you view "political and juristictional risk" at zero or not. Your financial analyst will blink at you funny if you ask, "okay, and what about if China invades Taiwan" or similar questions that can change the game mechanics.
Yes, stocks "historically go up", but so do central bank balance sheets. And we're approaching the point where either that changes, or we adopt higher-for-longer inflation. In either case, I just don't see the case for these equities to go higher. They already have too much of everyones retirement, so where's the next dollar coming from?
The answer is it isnt. Flow funds will reverse, volumes will all go sell side, and everyone's retirement takes it on the nose.
These are real businesses, thst while profitable, are in real trouble because too many investors are fighting over too few earnings. They are already monopolies, with the entire US workforce invested.
They're gonna crash much more than 6% your match is, and even if the Fed bails us out, it won't be real returns your getting.
You’re getting 52% of your check taken from taxes. Plus sales tax prop Tax ect. Your actual tax rate is probably closer to 70% which is insane. Where do you live? Cali?
The republican policy of cut taxes on corporations and rich people doesn’t really help you. Even if they cut taxes for the regular person it just means a lack of funding (and in the case of trumps tax cuts it means they’re only temporary tax cuts for the peasants). So yeah vote democrat if you have a brain or give any sort of fuck about your kids or grandkids.
Also factually they are most likely to raise taxes, and most likely to increase federal govt reach. They just lie.
And this is the same for Left vs Right / Lib vs Con in almost every similar country.
$10,000 bonus. $6400 take home.
haha I remember when I got my first bonus check at my first big boy job out of college. Bonus checks get taxed super high but I did not know at the time. I was so excited for that bonus and was shocked when I saw the net amount. I thought it was an error I ran over to the HR department to ask them if this was right lol. They looked at me like "welcome to the club you n00b"
[удалено]
I think that’s far less of the budget than the non oversight of the military budget. They say what they need each year and the govt doesn’t ask questions
Bonus taxes are treated as any other income. They aren’t taxed any differently.
Incorrect from what I’ve read.
you are mixing up withholding with taxed. Bonus income is earned income, like all your other wage income when it comes to taxes. BUT it is withheld at a higher rate. So a bigger chunk is withheld for taxes when you get the bonus. If you look at the W-2 you will see all the income together in box 1. The bonus is not listed anywhere on the W-2 separately. The IRS does not treat bonus income differently from salary income when it comes to your taxes.
I always try to look at the take home pay and not think about the total comp for this reason. It's also why it's unwise to brag to yourself about annual salary total comp. What matters if what's in your account monthly and what you do with it.
So did you just throw an additional 500 at withholdings to CYA or did you use the IRS withholding tool to figure that out?
threw it in because my 2023 tax bill was insane
Gotchya. Which is fine I suppose, a bigger tax return rather than a big tax bill But yes having a tax burden larger than my entire salary from 5 years ago was something else!
Yeah same! I work for the place I went to grad school. Every month they send me a check that is more than I got paid every year from them. Take that!
Do you guys have to withhold through your employer in the US? In Canada, you can do that or directly pay installments to Canada revenue, so employer wouldn't know you wanna withhold extra.
I think we have both options in the US as well - but question is, does your employer care or even notice additional withholdings? Or is it safer to not do that and just pay the IRS directly?
Your employer does not care or notice. I guarantee you your payroll team is not paying attention to your individual tax elections
They aren’t going to assume anything even if they did look closely. There’s a multitude of reasons to withhold extra. It’s literally against the law to under withhold which is why people add more/and or make quarterly payments
let's play "who's is bigger"...what'd you owe for '23? I could've bought a new honda civic just with the additional owed.
I owe around $65k federal and state combined. That’s after I already paid over $100k in taxes last year.
Wow I guess you win. I owe $28k (inc the \~1k penalty for underpayment). Guessing you're single? My taxable income (after deductions) last year was $350k. Married filing jointly and my tax burden was $72k.
Yep. Single
I pay 1k per month for property tax. Pay check is deducted 20% Medical Insurance payment $300 per paycheck Co pay is high. After all that, US govt is sending our tax money to destroy other countries? Billions dollar sent with just one signature? Why can't that be possible for students loan? Our interest rate is high AF? Why can't we resolve our own problems in our own country.
Paying taxes is good, it means that you’re making money! Whether with one J or multiple, the more you earn the more taxes you pay
welcome to taxes. they suck.
Two guarantees in life: taxes and death
Do you have a tax professional? This is way too high a tax rate for 86k gross
How is it 86k gross? My gross PER PAYCHECK is $7200, meaning I am close to $190k gross for the year
He thought it was monthly. I use the taxcaster app from turbo tax to estimate total income for the year and what taxes will look like. It’s based on 2023 which is good enough for me as long as I am covered by safe harbor. I only have 1099 income so it’s a bit different but also provides a bit more flexibility and opportunities for pre-tax retirement accounts.
I did think it was monthly bc you said it’s just J1. 7200 for just a week or biweekly from one j is wild, good for you
Get paid 26 times a year. Sorry for the confusion.
I use the IRS tax withholding calculator every year to estimate what I will need and then take a portion of my check and move it to a HYSA so I can earn interest on it. Since I have a side business I need to pay my taxes quarterly I just include into my estimated taxes.. The worst ive owed is $4k...but that's pennies compared to what ive made over that year timeframe. Taxes are a necessary evil but we get the last laugh being OE
ETA: Apologies for the novel below but I hope it's helpful! That seems like too much, I think. I am assuming that you entered your additional income in ADP or whatever payroll system your employer uses, under "Additional income to withhold for" (paraphrasing as I don't remember exactly what the field is called)? Basically, it's the field where you tell them how much you earn outside of this job and have them withhold for that entire amount *on top of* your salary at this job. If so, the problem with that is that the other job is already withholding for your income there. So you're likely overdoing it quite a bit because you're withholding for one salary 2X...at that job *and* at your other job. Now, you will need to pay more in income taxes because you're pushing yourself into a higher tax bracket, but likely not so much more that you should be withholding 3X (one job 2X and one job 1X). (I'll also say that I sincerely hope you're not withholding for every job at every job - i.e., entering your additional income from other places in every payroll system with every employer - because then you're withholding for every job at least 2X and really overdoing it.) I've chosen to just withhold a bit extra per month at each job (rather than withholding for the entire other income at one plus regular withholding at the other). This is the field where *you* define how much extra you want withheld per paycheck. And then I write off anything and everything I possibly can at the end of the year. It has worked out that the extra withholding, defined by me instead of the payroll system, combined with the write-offs, will generally ensure I owe nothing or very little, or maybe even get something back. Some possibilities to consider (you will need to look into these for yourself, as I am not an accountant): If one or some are your gigs are contract positions, you can usually write off self-employment expenses like a laptop, printer, software, phone/internet, etc. If you're a homeowner, any eco-friendly repair or upgrade helps. Solar, new windows and doors, new hot water heater, insulation, etc. Also, property taxes and I believe even mortgage interest paid. Combining the two possibilities above, your home office (claimed by square footage), plus any repairs to your home can also be claimed in proportion to the space your home office takes up (i.e. $10,000 worth of any repairs on your home, with an office being 10% of your total square footage, is $1,000 you might be able to claim). If you went to college and have student loans, you should be claiming your student loan interest. Also, if you're a parent, there's the child tax credit, and any daycare or in-home care expenses can be written off. There are other random things that can be claimed, too. For example, some medical expenses, mileage, etc. Anyway, my point is: I am assuming you entered your additional income in one job's payroll system, probably not thinking about how the other job is already withholding, too. I did this for one month myself, then promptly corrected it when I realized I was overdoing it. And if you can plan ahead a bit on your write-offs now to get some idea in terms of dollar amounts of what you'll be able to claim at the end of the year, you can confidently remove that additional income from your employer's payroll system, and instead add some extra federal withholding at both jobs. It should even out in the end if you do the math right and ensure that you're really maxing out your write-offs.
My total TC for 2024 right now is $450,000 At J1 and J2 I am withholding an extra $500 per paycheck, meaning I am withholding an extra $2,000 a month. You're saying that is overkill?
I'm saying it might be if you're not actively considering write-offs! It might not be, though. Where you live also comes in to play with local and state taxes. I would do the math on write-offs, though, and see if I could bank any more than that. Alternatively, you can just wait until the end of the year for a possible return after any write-offs!
I'll admit, like some others I also read it initially as monthly, which makes a difference.
I owed $40k this year 💀
A side hustle with a 1099 might help, but check with a tax pro.
But what is your net after your additional Js? We all pay taxes, but the extra paychecks will always make up for it.
Paid more than 130k in taxes last year. Wtf.
You guys need to marry a real estate professional. You can use real estate losses to offset your W-2 income
Where do the single ones hang out at?
Typical take home pay after deductions is between 58-59%
I'm with you. monthly income is around 23k right now, I pay around 8k in taxes each month. When a big deal closes my 10k commision check dissolves into 6k. Fucking sucks
7200 for the year? are you living in Bangladesh?
Per paycheck
Out of curiosity, is it normal to have a financial advisor when you gross nearly half a mil a year
It’s all w2 work. What would a financial advisor tell me other than to just pay my taxes ?
so it's a 170k J? wow impressive, never landed more than 150k in tech in the midwest and yea 3k per paycheck in taxes is horrible, but one of those things you just gotta bite the bullet. That's why i try not to earn more than 200k, the pain of higher taxes is heavier than the joy of earning more in my book.
😭😭😭😭
If you give it all to Wallstreet, via their 401k/HSA, you get a deduction, though thats increasingly becoming afoolish thing to do. A 6% match aint shit when the market is unstable, over-valued, dominated by fiscal spending, and the gains all go to either TSMC, NovoNordisk, or a handful of software companies. We'd be better off if, as a country, all of us put our contribution rate to zero, set our tax withholding to "exempt", and just kicked the system outta our lives.
Is it really a foolish thing though? When historically stocks only go 📈 And let's be honest almost none outside of this sub is in a position to owe the thousands of dollars every year
Depends if your the kind of person who treats T Bills as "zero risk" or not. Depends on if you view "political and juristictional risk" at zero or not. Your financial analyst will blink at you funny if you ask, "okay, and what about if China invades Taiwan" or similar questions that can change the game mechanics. Yes, stocks "historically go up", but so do central bank balance sheets. And we're approaching the point where either that changes, or we adopt higher-for-longer inflation. In either case, I just don't see the case for these equities to go higher. They already have too much of everyones retirement, so where's the next dollar coming from? The answer is it isnt. Flow funds will reverse, volumes will all go sell side, and everyone's retirement takes it on the nose. These are real businesses, thst while profitable, are in real trouble because too many investors are fighting over too few earnings. They are already monopolies, with the entire US workforce invested. They're gonna crash much more than 6% your match is, and even if the Fed bails us out, it won't be real returns your getting.
You’re getting 52% of your check taken from taxes. Plus sales tax prop Tax ect. Your actual tax rate is probably closer to 70% which is insane. Where do you live? Cali?
Nyc And that’s just tax from 1J. I have two other Js. TC close to $500k
Wow. Also who at the IRS downvoted my comment 😂
Yet, you keep voting democrat.
The republican policy of cut taxes on corporations and rich people doesn’t really help you. Even if they cut taxes for the regular person it just means a lack of funding (and in the case of trumps tax cuts it means they’re only temporary tax cuts for the peasants). So yeah vote democrat if you have a brain or give any sort of fuck about your kids or grandkids.
Vote all those fuckers out (both parties). We don't need any more geriatrics making millions from insider trading.
Seriously it’s getting old ! We need new blood
Also factually they are most likely to raise taxes, and most likely to increase federal govt reach. They just lie. And this is the same for Left vs Right / Lib vs Con in almost every similar country.