Welcome Guest. Register Now!  



Reply
 
LinkBack Thread Tools Search this Thread Display Modes
  #1 (permalink)  
Old 09-11-2013, 02:42 AM
Junior Member
 
Join Date: Sep 2013
Posts: 1
Question on income taxes

I have a basic tax question.

I have received some reward amount from my employer couple of months back. Below is my paycheck summary for that month

Salary - 4399.33
Award - 3422.25
Gross - 7568.08
Gross till that date - 58,296.66

Here is the tax break down:
Federal - 1304.69
SS Tax - 456.20
Medicare - 106
State - 486
SUI/SDI - 73.57

*-the award amount I received after taxes is ~ $1900

But there was an agreement that I have to payback the amount what I received If I quit the company and two options are given:
1. Either I write a check for $1900 to them (OR)
2. They deduct actual amount of $3422.25 before taxes in the final settlement

Somehow I believe both the options are not equal and I would be losing more money in the second option. Some how I went with option-2, here is the summary of my final pay-check:

Salary - 15322
Reward deduction - (-)3422
Gross - 11900
Gross till date - 58296

Tax breakdown:
Federal - 2595
SS Tax - 724
Medicare - 169
State - 929
SUI/SDI - 116

Did I make a mistake by choosing option-2? would I be saving some more bucks by going for option-1 or both the options are same? Please advice?



Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
  #2 (permalink)  
Old 09-11-2013, 04:55 AM
Moderator
 
Join Date: Oct 2010
Posts: 5,139
Quote:
Originally Posted by karusalar View Post
I have a basic tax question.

I have received some reward amount from my employer couple of months back. Below is my paycheck summary for that month

Salary - 4399.33
Award - 3422.25
Gross - 7568.08
Gross till that date - 58,296.66

Here is the tax break down:
Federal - 1304.69
SS Tax - 456.20
Medicare - 106
State - 486
SUI/SDI - 73.57

*-the award amount I received after taxes is ~ $1900

But there was an agreement that I have to payback the amount what I received If I quit the company and two options are given:
1. Either I write a check for $1900 to them (OR)
2. They deduct actual amount of $3422.25 before taxes in the final settlement

Somehow I believe both the options are not equal and I would be losing more money in the second option. Some how I went with option-2, here is the summary of my final pay-check:

Salary - 15322
Reward deduction - (-)3422
Gross - 11900
Gross till date - 58296

Tax breakdown:
Federal - 2595
SS Tax - 724
Medicare - 169
State - 929
SUI/SDI - 116

Did I make a mistake by choosing option-2? would I be saving some more bucks by going for option-1 or both the options are same? Please advice?
Both the options #1 and #2 are the same; in option #1, $1,900 that you need to payback to your ER is after tax dollar after taxes withheld on the gross rewards of $3,422.25 while the gross amount of $3,422.25 that they deduct is itself the whole of $3,422.25. Your taxes withheld on the gross amount of $3,422.25’d be reduced as your ER deducted the amount on yur paycheck.



Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
Ads
Reply


Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

vB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Help! Income tax question - Can they do this? jlowe215 Income 4 03-08-2013 01:41 PM
AGI Question - foreign income question tikomh Income 1 04-09-2012 09:22 AM
Question About New PayPal Rules & Taxes la121 Income 4 07-25-2011 11:15 PM
Mary Kay and taxes question funkepeacock Filing Requirements 0 03-11-2010 04:36 PM
Help with income question mkcotton Income 1 01-29-2009 01:40 AM

Follow us on Facebook Follow us on Twitter Google Buzz Rss Feeds

» Categories
 
Individual
 » Income
 » IRA/Sep
 » Medical
 
Corporations
 » Payroll
 
Forum for CPAs
 
Financial Planning