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Old 01-20-2015, 03:17 PM
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Sign on Bonuses - Taxes

Tried finding an answer, but ended up empty.

I was given a sign-on bonus of 30K earlier in 2014, with the clause that if I left within a year, I have to pay it back. Of course, i received post-taxed 30K, lets say 20K.

I decided to leave the company in 5 months, and of course HR came back for the bonus. Luckily they only asked for the net amount they paid me. I hadnt touched the money, and returned it to them. All good.

Now the W-2 has come from them, and they have made the 30K a part of my income. Should they not take it out, cause i paid it back to them.

I wouldnt be too worried about it since the taxes were paid by them, but if I add this 30K to my income, I push into the next tax bracket, forcing me to pay more taxes on everything.

Seems like a lose lose situation.

Thoughts? Advice? Anything I can do while filing my taxes to show that I paid this money back to the company????



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Old 01-20-2015, 11:54 PM
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Join Date: Oct 2010
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Quote:
Originally Posted by buckeyedoc View Post

I wouldnt be too worried about it since the taxes were paid by them, but if I add this 30K to my income, I push into the next tax bracket, forcing me to pay more taxes on everything.

Seems like a lose lose situation.

Thoughts? Advice? Anything I can do while filing my taxes to show that I paid this money back to the company????
The difference between the 30k and the 20k is mostly related to federal and state taxes that the employer withheld and paid over to the government on your behalf. As a result, when you file your tax returns you will be able to claim these amounts as tax payments against your tax. For example, if you owe no tax for the year, then the entire amounts that your employer withheld and paid to the government will be refunded to you when you file your tax return.you might even be able to get a refund of the fica taxes that were withheld. However, it is impossible to tell if there were other amounts that you will not get back. Generally though, your employer is right that you should pay the full amount or likely something close to it.



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