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April 15th - Tax day

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  • HHusky
    HHusky Member Posts: 24,406
    See the USA in your Chevrolet, Fidel.
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  • jecornel
    jecornel Member Posts: 9,737
    CirrhosisDawg said:

    HHusky said:

    jecornel said:

    HHusky said:

    “About” 480. Like I said.

    So what was the problem?
    No problem. Just trying to figure out how you’re paying more than half a million in taxes on a million dollars. That’s a talent no one else has.
    In the financial services industry, post recession and financial services law reform, bonus payment income has mandatory withholding requirements of about 50%. Thus, if your salary is $200k and your bonus is $800k, net monthly income will be about $40k to 45k. You settle up every April 15, but $40k or slightly more net monthly income in the financial services industry is about right.
    Thank you cirrohosis dawg.
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  • HHusky
    HHusky Member Posts: 24,406
    CirrhosisDawg said:

    HHusky said:

    jecornel said:

    HHusky said:

    “About” 480. Like I said.

    So what was the problem?
    No problem. Just trying to figure out how you’re paying more than half a million in taxes on a million dollars. That’s a talent no one else has.
    In the financial services industry, post recession and financial services law reform, bonus payment income has mandatory withholding requirements of about 50%. Thus, if your salary is $200k and your bonus is $800k, net monthly income will be about $40k to 45k. You settle up every April 15, but $40k or slightly more net monthly income in the financial services industry is about right.
    A mandatory withholding requirement that is 10% higher than the maximum tax rate? What law is that?
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  • MisterEm
    MisterEm Member Posts: 6,685
    edited April 2019
    jecornel said:

    Blu82 said:

    I would like to take this opportunity to thank President Trump for lowering the amount of taxes that are extorted from me annually.

    I'm not complaining this year......at all.
    Amen.

    Passive rental activity changed, took a small hit there. But both State and Federal wage income and business revenue went down, considerably.
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  • CirrhosisDawg
    CirrhosisDawg Member Posts: 6,390
    HHusky said:

    CirrhosisDawg said:

    HHusky said:

    jecornel said:

    HHusky said:

    “About” 480. Like I said.

    So what was the problem?
    No problem. Just trying to figure out how you’re paying more than half a million in taxes on a million dollars. That’s a talent no one else has.
    In the financial services industry, post recession and financial services law reform, bonus payment income has mandatory withholding requirements of about 50%. Thus, if your salary is $200k and your bonus is $800k, net monthly income will be about $40k to 45k. You settle up every April 15, but $40k or slightly more net monthly income in the financial services industry is about right.
    A mandatory withholding requirement that is 10% higher than the maximum tax rate? What law is that?
    Sometime around 2010, investment banker bonuses started having mandatory nearly 50% withholding requirements on payouts. Not salary. Just bonuses. It was part of the crackdown on Wall Street and annual incentive payments. I can’t recall the specific bill now but it’s been a fact of life for about 10 years now.
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  • HHusky
    HHusky Member Posts: 24,406
    CirrhosisDawg said:

    HHusky said:

    CirrhosisDawg said:

    HHusky said:

    jecornel said:

    HHusky said:

    “About” 480. Like I said.

    So what was the problem?
    No problem. Just trying to figure out how you’re paying more than half a million in taxes on a million dollars. That’s a talent no one else has.
    In the financial services industry, post recession and financial services law reform, bonus payment income has mandatory withholding requirements of about 50%. Thus, if your salary is $200k and your bonus is $800k, net monthly income will be about $40k to 45k. You settle up every April 15, but $40k or slightly more net monthly income in the financial services industry is about right.
    A mandatory withholding requirement that is 10% higher than the maximum tax rate? What law is that?
    Sometime around 2010, investment banker bonuses started having mandatory nearly 50% withholding requirements on payouts. Not salary. Just bonuses. It was part of the crackdown on Wall Street and annual incentive payments. I can’t recall the specific bill now but it’s been a fact of life for about 10 years now.
    I get that bonuses would have taxes withheld at the maximum tax rate. But the maximum tax rate is considerably lower than 50%.
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  • MikeDamone
    MikeDamone Member Posts: 37,781
    HHusky said:

    CirrhosisDawg said:

    HHusky said:

    CirrhosisDawg said:

    HHusky said:

    jecornel said:

    HHusky said:

    “About” 480. Like I said.

    So what was the problem?
    No problem. Just trying to figure out how you’re paying more than half a million in taxes on a million dollars. That’s a talent no one else has.
    In the financial services industry, post recession and financial services law reform, bonus payment income has mandatory withholding requirements of about 50%. Thus, if your salary is $200k and your bonus is $800k, net monthly income will be about $40k to 45k. You settle up every April 15, but $40k or slightly more net monthly income in the financial services industry is about right.
    A mandatory withholding requirement that is 10% higher than the maximum tax rate? What law is that?
    Sometime around 2010, investment banker bonuses started having mandatory nearly 50% withholding requirements on payouts. Not salary. Just bonuses. It was part of the crackdown on Wall Street and annual incentive payments. I can’t recall the specific bill now but it’s been a fact of life for about 10 years now.
    I get that bonuses would have taxes withheld at the maximum tax rate. But the maximum tax rate is considerably lower than 50%.
    https://taxmap.irs.gov/taxmap/pubs/p15-006.htm
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  • HHusky
    HHusky Member Posts: 24,406
    Thanks Mike.

    If a supplemental wage payment, together with other supplemental wage payments made to the employee during the calendar year, exceeds $1 million, the excess is subject to withholding at 37% (or the highest rate of income tax for the year). Withhold using the 37% rate without regard to the employee's Form W-4.
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  • CirrhosisDawg
    CirrhosisDawg Member Posts: 6,390
    HHusky said:

    Thanks Mike.

    If a supplemental wage payment, together with other supplemental wage payments made to the employee during the calendar year, exceeds $1 million, the excess is subject to withholding at 37% (or the highest rate of income tax for the year). Withhold using the 37% rate without regard to the employee's Form W-4.

    And with social security, 401k deposits, employee portion of benefits, etc, the net cash to the employee from the bonus is about 50 pct. Much lower than a salary payment where your deductions apply. All of which substantiates the $40-$45k or so average monthly income on a gross $1 million income number (depending on the salary / bonus split and before you settle up with the IRS every April).
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  • jecornel
    jecornel Member Posts: 9,737
    HHusky said:

    Thanks Mike.

    If a supplemental wage payment, together with other supplemental wage payments made to the employee during the calendar year, exceeds $1 million, the excess is subject to withholding at 37% (or the highest rate of income tax for the year). Withhold using the 37% rate without regard to the employee's Form W-4.

    Alright then better for you. If you are barely surving on on 50 grand (52,500) a month then dial it back a little.

    If you could find a way to live on the 200k for a year you could make your remaining money work for you so that you are able to generate passive income. Then you could be rich.
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