Submitted by dragunight t3_10q0mt1 in personalfinance
wickedkittylitter t1_j6n3w7h wrote
It looks like your employer used the other method of calculating withholding on a bonus and that method is to withhold not as supplemental income, but as normal income when it comes to withholding. That means that taxes were withheld thinking $48k is a normal, routine pay amount. Overall, the method of withholding doesn't matter. Everything will even out when you file your taxes for 2023.
dragunight OP t1_j6n4huh wrote
So if this happened on every one of my bonuses in 2022, I should have a pretty massive tax refund coming back to me this year?
Boring-Cartographer2 t1_j6n59xp wrote
Directionally yes but there could be offsetting factors. For example if you made a lot of dividend or interest income then the taxes on those might wash out the refund you would get otherwise.
dragunight OP t1_j6n67qy wrote
Unfortunately, I can assure you I have not :(
Boring-Cartographer2 t1_j6n4lcx wrote
This, except I wouldn’t say it doesn’t matter, because OP is giving the government a free loan. They could try adjusting their withholding elections for the rest of the year to try to offset this.
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