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Bonus and Taxes

December 9th, 2011 at 06:28 am

DH says that bonus checks will be mailed on the 16th. Still no word on what his percentage will be. I'll probably know before he will because it'll arrive in the mail before he comes back home on the 21st. They will tax it at 25%, because they do that with bonuses, but he will get most of that back when we file our tax return. He's already met the one tax cap for the year anyway.

He also did a preliminary run at our taxes. Of course until he knows about the bonus amount it won't be completely accurrate, but with just the information we have now, we're looking at around $8500. Now before someone starts on about changing our witholding, a good portion of that is due to medical reimbursement.

And the part that isn't, around $3,500, well, it wouldn't matter. DH works 26 weeks a year, but he is taxed as if he worked 52. It is stupid, but it is the way it is for slope workers. We have tried numerous times to do something about it, but until they change this particular quirk of the tax code there is nothing we can do about it. They take out what they take out and that is that.

Still, it means a fairly massive payment to debt come March. And if the bonus is the rumored 10% of a year's salary, we just might be out of CC debt entirely between the two. Which would be awesome.

We need to look into the sales tax deduction as well. We have no state income tax so we are allowed to deduct sales tax, but we never have because we have never itemized. It was never more than the standard deduction in the past. It might actually be worth it this year to do so. And if it is we can take the sales tax deduction. We have bought some big ticket items this year (including the car). That could push our return even higher. It sure would be nice to temporarily get the governments' hands out of our pockets for a minute or two.

2 Responses to “Bonus and Taxes”

  1. Petunia 100 Says:
    1323449977

    Heck yeah it would be awesome if the bonus + tax return got you out of credit card debt! Woo-hoo! Keeping my fingers crossed for you.

  2. frugaltexan75 Says:
    1323480821

    What an awesome feeling to be cc debt free! I hope that it all works out that way for you!

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