Ask TaxMama.Com Tax Information With A Mother's Touch Published by Eva Rosenberg, MBA, EA Volume 5, Issue 239        December 19, 2003

Legends and Charity Stock Loss Don't Want Mom's Money What's In A Name Paycheck Deductions   2004 Filing Locations Now Available Online IRS Issues Nearly 500,000 EINS Online   Breakfast Special   E-Mail  This Page To A Friend Your email: Your name: TO email:

Paycheck Deductions » From: Houston, TX Dear TaxMama: What percentage can be legally deducted from a bonus check and why? Georgie Ann Hi Georgie Ann, Typically, your payroll department deducts about 25% for Federal taxes from bonus checks, regardless of what appears on the W-4 you've filed with them. This always upsets employees. It never fails. So, I do understand your frustration. But this happens because their program uses a different tax table for the occasional checks, like bonuses or quarterly commissions. When I know this check is coming, I advise people to file a W-4 just for that check, that shows 99 dependents. That's usually the only way to reduce or zero out that large deduction. No doubt, they've already taken your money. You'll get it back when you file your tax return - so file it early. On the other hand, be glad you got a bonus. Those of us working for ourselves never do. Naturally, all your other routine payroll deductions will also rear their ugly heads. But that goes without saying. Best wishes, Eva Rosenberg Your TaxMama

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