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Author: reddogracing2 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121572  
Subject: Bonus Date: 6/15/2001 10:24 PM
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I started a new job in January. Part of the package was a sign on bonus, that was to be repaid if I left before one year. It now looks like I may do that. My question regards the amount to be repaid. A big chunk of the bonus was taken out as taxes. Do I have to repay the entire amount, or only the portion I received? If I have to pay the entire amount. do I get credit for the big chunk of taxes I paid on money I don't have? This seems like I'm getting the short end of the stick, if I have to pay back more than I got, and don't get credit for the taxes. Also, I'm not sure if this is the right place to be asking this question, or who I should ask (a lawyer? an accountant?) Any replies appreciated.
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Author: acm4tax Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 51852 of 121572
Subject: Re: Bonus Date: 6/16/2001 12:47 AM
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I started a new job in January. Part of the package was a sign on bonus, that was to be repaid if I left before one year. It now looks like I may do that. My question regards the amount to be repaid. A big chunk of the bonus was taken out as taxes. Do I have to repay the entire amount, or only the portion I received?

You will have to repay the gross amount received which will include the taxes withheld. If you received and repay the money in the same year, you will negate the tax liability 100%.

But if you repay in different calendar years, different rules apply depending on whether you repay more or less than $3000. See IRS Pub 525 for more information.

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Author: gailkay One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 51854 of 121572
Subject: Re: Bonus Date: 6/16/2001 1:56 AM
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If I have to pay the entire amount. do I get credit for the big chunk of taxes I paid on money I don't have?

Yes. Your W-2 will show your wages without the bonus (paid and repaid) but will include the taxes withheld - those withholdings will either reduce the amount you owe in April 2002 or increase the refund you will receive.

Gail ~


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Author: reddogracing2 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 51855 of 121572
Subject: Re: Bonus Date: 6/16/2001 10:25 AM
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Wow, that was fast. Thanks for the replies - looks liked I guessed right on where to ask :)

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