what facts are alternative? you stated I, as well as most people know......I simply claimed that I don't have the ability to know what most people think.
I received this link from PayPal about the IRS today.
- Thread starter jayman
- Start date
You are correct, but the taxes you already paid are also included, i.e. you're not taxed twice on the same amount. Regardless of whatever alternative method you use, you only pay tax on it once. Actually, if you want to get nit-picky about it then you actually get taxed LESS on it at the end of the year - you get more money back! (That's correct if your effective tax rate is lower than the original tax on the bonus).
You stated false facts, were corrected, and then indicated you don't know what others think. Meaning you have your opinion, but it's wrong, but since you're not like everyone else then it must be right, but it's still wrong and since you actually believe them (your opinions) well, then they are alternative facts.
Regarding this stuff, I don't have to think about it, I actually do it for a living
(for a few short days)
I can go on all day long. I already said you shouldn't post about taxes and law, if I were you, I would say thank you, may I have another, and go on about your day. It will not end well.
Let's say Bobbi Jo makes $12K a year, $1,000 a month, and she's taxed $200 per month (20 percent, which is high for her income level, just using it as an example).
So, at the end of the year she would have $12K in earnings and would've paid $2,400 in taxes for a total take home of $9,600.
Now, let's say she gets a $5,000 bonus and pays $2,500 in taxes and takes home $2,500. (50% tax rate)
In your world, that $5,000 gets added to her total income and she's taxed on all of it, but that's not what happens.
At the end of the year, when filing your taxes you fill out a 1040 and in short you tell them how much you were paid - in total - in Bobbi Jo's case this would be $17,000.00 - in an attempt at keeping it simple I'm not getting involved with deductions or misc schedules. Income in - tax out.
Then, on line 25 of the 1040 you will enter the taxes you have paid for the year, so in Bobbi Jo's case she would put the $2,400 she paid via her normal paychecks AND the $2,500 paid via the bonus.
This is where it can get complicated.
NOW the government says - ok - you had $17K in income, with your deductions your taxes are 25%, it's 20% for $12K but it's 25% for $17K (all example numbers).
Ok, still with me...
Now take the $17K and multiply it by .25 and the taxes OWED for the year are - $4,250. Oh, but wait, she paid $4,900? Now what? Now, she gets a refund of $650.00 and in the end she paid 25% on ALL of her income - that is her EFFECTIVE tax rate.
Now, flip that around and imagine they didn't take that 50% on that bonus. She STILL would've earned $17K, she STILL would've paid 25% on her income but she would've only paid $2,400 in taxes for the year and now, poor little Bobbi Jo would owe $1,850 in taxes.
If you don't get it after that, then I can't help you.
So, at the end of the year she would have $12K in earnings and would've paid $2,400 in taxes for a total take home of $9,600.
Now, let's say she gets a $5,000 bonus and pays $2,500 in taxes and takes home $2,500. (50% tax rate)
In your world, that $5,000 gets added to her total income and she's taxed on all of it, but that's not what happens.
At the end of the year, when filing your taxes you fill out a 1040 and in short you tell them how much you were paid - in total - in Bobbi Jo's case this would be $17,000.00 - in an attempt at keeping it simple I'm not getting involved with deductions or misc schedules. Income in - tax out.
Then, on line 25 of the 1040 you will enter the taxes you have paid for the year, so in Bobbi Jo's case she would put the $2,400 she paid via her normal paychecks AND the $2,500 paid via the bonus.
This is where it can get complicated.
NOW the government says - ok - you had $17K in income, with your deductions your taxes are 25%, it's 20% for $12K but it's 25% for $17K (all example numbers).
Ok, still with me...
Now take the $17K and multiply it by .25 and the taxes OWED for the year are - $4,250. Oh, but wait, she paid $4,900? Now what? Now, she gets a refund of $650.00 and in the end she paid 25% on ALL of her income - that is her EFFECTIVE tax rate.
Now, flip that around and imagine they didn't take that 50% on that bonus. She STILL would've earned $17K, she STILL would've paid 25% on her income but she would've only paid $2,400 in taxes for the year and now, poor little Bobbi Jo would owe $1,850 in taxes.
If you don't get it after that, then I can't help you.
Yes, in many states, and especially the Bahamas. No need for Elon to use American banks for loans.
Congress critters after receiving lobbyists (i.e., bribes)
I am not blaming Elon for the tax code.
I just happen to think that the really high earners should be paying at least as much percentage wise as the upper middle class.
I also happen to think the corporations should pay taxes at a reasonable rate.
Yes, but instead of concentrating on income tax, one should consider the total tax burden {Fed, state, county, local, excise, property, ...}
I made $6.7M last year so I have a good idea what is needed.
all forms of
Of course not. The laws are written by people who care about the special interest lobbiests.
Pretty small, I go $320,000...
whoopti-doo 12%
If you want to live in a tax-free haven, I suggest Somalia.
If/when he ever converts the options to cash.
I have owned (given) options and have exercised those options, I'm not completely familiar with assigning options so I did a bit of research and in the end, as long as there is a taxable event, he will be paying taxes on those options. That is actually basic tax knowledge - if there is a gain or loss it is a taxable event and someone is paying taxes.
I don't know, or care, enough to worry about the details here but he absolutely pays taxes if he gains money in the assignment of options.
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What some who receive large bonuses don't realize or think about is how computerized payroll systems work. They are tied to a table, a matrix. If you have properly given the payroll department your withholding that matches how you file you should hit it pretty close at the end of the year.
However, these calculations are done by annualizing the curent paycheck. So if you get a large bonus the system thinks that is what you are making every pay period and the federal witholding part will be skewed. The best approach is have the federal withholding changed to a different percent or flat amount if you don't want heavy withholding on that check. As mentioned earlier, regardless what is withheld, your true tax load is on total earnings. The withholding is actually an estimate.
However, these calculations are done by annualizing the curent paycheck. So if you get a large bonus the system thinks that is what you are making every pay period and the federal witholding part will be skewed. The best approach is have the federal withholding changed to a different percent or flat amount if you don't want heavy withholding on that check. As mentioned earlier, regardless what is withheld, your true tax load is on total earnings. The withholding is actually an estimate.
Payments throughout the year are estimated TAX payments............ that you don't get to spend, so technically its only one Tax payment but in reality the Government takes YOUR money EVERY WEEK out of YOUR PAY.
With the pResident in the White House now I don't need to move to Somalia, we already have lawless immigration, gangs controlling the streets, illegal drugs everywhere, corrupt Government leaders, why move?
Have you read all of the 58,000 pages of tax code? Get back to me when you do. The tax code is complicated so Americans who work 40 or more hours per week and have families and homes to take care of don't have the time to do it themselves or the money to pay accountants to do it for them.
I happen to think the corporations should pay taxes at a reasonable rate......they are following the tax code right? If you want high earners to pay a bigger share get rid of Income tax and have a flat tax on all purchases, no need for the IRS , the more you buy the more tax you pay, and you get rid of thousands of jobs in the Federal government that tax payers pay for and taxes money that is made on illegal activity
adding & subtracting ain't hard, understanding the impacts of these policies is, in your scenario Bobbi Jo is far from rich, she is the EXACT person who needs her Christmas bonus, she has the choice of paying the $650.00 up front and paying $1850.00 in the end or what most likely happens is she uses a credit card at Christmas so she can by toys for her kids , since her credit rating isn't really good she pays somewhere around 28 to 30% interest on the card and it costs her even more, the tax laws could be written to protect people like Bobbi Jo but in reality the Government doesn't give a damn about her.
What does this comment have to do with my comment that you quoted? The tax code, of which I am quite familiar since I have been a practicing CPA for over 35 years, has nothing to do with my explanation of how to keep federal tax withheld within reason, on the occasional much larger than usual paycheck.
He clearly has no idea what he's talking about so he's trying to either deflect or move the goal posts. It's a common theme for him.