This doesn't sound like a cash flow issue. This sounds more like a framing issue.
The OP has to prepay loads more for tax withholding ($26k/yr), as taxes on the significant bonus has to be paid evenly throughout the year. The corollary is that the proportional taxes on the significant bonus payment isn't as high as that for regular salary, as it's certainly over the payroll deduction limit and as a good portion of the taxes on the bonus was already pre-withheld.
Yet there is no accounting of the after-tax pay on the bonus payment, which based on the $1k/extra withheld per biweek appears to ~$75k.
Surely the take home from the bonus would alleviate this cash flow issue? Back of envelope calc would be ~$3k/month.
The OP has to prepay loads more for tax withholding ($26k/yr), as taxes on the significant bonus has to be paid evenly throughout the year. The corollary is that the proportional taxes on the significant bonus payment isn't as high as that for regular salary, as it's certainly over the payroll deduction limit and as a good portion of the taxes on the bonus was already pre-withheld.
Yet there is no accounting of the after-tax pay on the bonus payment, which based on the $1k/extra withheld per biweek appears to ~$75k.
Surely the take home from the bonus would alleviate this cash flow issue? Back of envelope calc would be ~$3k/month.
Statistics: Posted by InvisibleAerobar — Mon Feb 17, 2025 12:50 am — Replies 8 — Views 382