topic Re: Severance Update in Community Chat

Severance Update

meem120 — Thu, 24 Jul 2014 01:39:01 GMT

Hi Everyone Just wanted to let you know the outcome. My wonderful boss is giving me $33000.00 as my severance/ bonus/ parting gift. Don't know what to call it anymore now!! I am thrilled and so happy. But most of all so glad to to be appreciated for my 33 years of service He said his success is my success also. Very very nice

Re: Severance Update

tansy — Thu, 24 Jul 2014 01:39:44 GMT

Good news!!

Re: Severance Update

terrier3 — Thu, 24 Jul 2014 01:40:08 GMT

Congratulations...how wonderful.

Enjoy your retirement!

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missy1 — Thu, 24 Jul 2014 01:42:16 GMT

WOW! Do you get taxed on it?

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Big Sister — Thu, 24 Jul 2014 01:43:49 GMT

He did the right thing and he knew you deserved that amount.

Congratulations for the happy ending.

Re: Severance Update

Qwackertoo — Thu, 24 Jul 2014 01:47:05 GMT

I'd be tempted to turn in a W4 with 99 dependents because the bite of taxes IF it is given to you lump sump is going to be way too much . . . unless he has other plans for distribution. Might want to check with the payroll clerk or supervisor.

And CONGRATULATIONS!!!! It is great when you get to work with good people who treat you right!!!

Re: Severance Update

tansy — Thu, 24 Jul 2014 01:48:04 GMT

What is the gift limit now for taxes?

Re: Severance Update

Marp2 — Thu, 24 Jul 2014 01:53:29 GMT

Congratulations mcall. I'd like to suggest that BEFORE you collect the money you consult with an accountant to see how you can minimize or defer taxes.

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Tinkrbl44 — Thu, 24 Jul 2014 01:55:25 GMT

Yeeeee - haaaaaa !!!!

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Bird mama — Thu, 24 Jul 2014 01:56:14 GMT

I'm very happy for you McCall

Re: Severance Update

terrier3 — Thu, 24 Jul 2014 01:59:11 GMT

On 7/23/2014 Marp2 said:
Congratulations mcall. I'd like to suggest that BEFORE you collect the money you consult with an accountant to see how you can minimize or defer taxes.

You can't defer taxes on a one time payment. I'm sure he will be classifying it as a bonus. If it was a gift, the boss would also owe gift taxes because it is over the annual limit. As a bonus, he can claim it as a business expense.

I used to get a one time bonus if I made 110% of my budget the year before. It was taxed just like any other income.

So what? She still is far ahead!

Re: Severance Update

stilltamn8r — Thu, 24 Jul 2014 02:21:49 GMT

You obviously know him very well after 33 years- you said he would take care of you and he did! You certainly deserve it! Best of luck with the next phase of your life!

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KathyPet — Thu, 24 Jul 2014 02:23:38 GMT

Wow! what a great boss!

Re: Severance Update

Qwackertoo — Thu, 24 Jul 2014 02:33:50 GMT

I don't recall when your last day is . . . but depending on IF you work through Oct or Dec 31 or whatever that last date is . . . IF you do not plan to work anymore . . . IF he cut the check and dated it AFTER 1-1-15 . . . IF possible . . . that would lower your net tax liability . . . spreading your earned income to date from 2014 to be taxed in 2014 and your "severence/bonus/retirement" to be paid and taxed in 2015.

That is just one possibility.

Again, congrats and you might also look for severence/bonus tax calculators. There is also some info where they say employers can tax it at a flat 25% rate. I know times when we've received a huge bonus . . . sometimes as much as 1/3 or more gets eaten up with taxes taken out resulting in usually an over payment when we "adjust" with changing our W4 claimed dependents . . . taking care to do so within the letter of the law . . . of course.

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CardinalGirl — Thu, 24 Jul 2014 02:34:27 GMT

Congratulations!

Re: Severance Update

terrier3 — Thu, 24 Jul 2014 02:39:50 GMT

On 7/23/2014 Qwackertoo said:
I don't recall when your last day is . . . but depending on IF you work through Oct or Dec 31 or whatever that last date is . . . IF you do not plan to work anymore . . . IF he cut the check and dated it AFTER 1-1-15 . . . IF possible . . . that would lower your net tax liability . . . spreading your earned income to date from 2014 to be taxed in 2014 and your "severence/bonus/retirement" to be paid and taxed in 2015.

That is just one possibility.

Again, congrats and you might also look for severence/bonus tax calculators. There is also some info where they say employers can tax it at a flat 25% rate. I know times when we've received a huge bonus . . . sometimes as much as 1/3 or more gets eaten up with taxes taken out resulting in usually an over payment when we "adjust" with changing our W4 claimed dependents . . . taking care to do so within the letter of the law . . . of course.

Her boss is giving her a generous bonus.

He will want to use it as a tax deduction (business expense) in the year in which he owned his business - which he is closing soon.

SO WHAT if she pays a little more in taxes? What's so bad about being in a slightly higher tax bracket?

If you won $33,000 in the lottery, wouldn't you be grateful for the extra income.

You are all looking at what she won't get out of the bonus...not what she WILL receive. The glass is more than half full folks!

Re: Severance Update

magicmoodz — Thu, 24 Jul 2014 02:47:22 GMT

mccall, I am so happy with this outcome! Proof of what an asset you have been to the firm!

Happy days ahead! What are you going to buy?

Re: Severance Update

Qwackertoo — Thu, 24 Jul 2014 03:07:42 GMT

On 7/23/2014 terrier3 said:
On 7/23/2014 Qwackertoo said:
I don't recall when your last day is . . . but depending on IF you work through Oct or Dec 31 or whatever that last date is . . . IF you do not plan to work anymore . . . IF he cut the check and dated it AFTER 1-1-15 . . . IF possible . . . that would lower your net tax liability . . . spreading your earned income to date from 2014 to be taxed in 2014 and your "severence/bonus/retirement" to be paid and taxed in 2015.

That is just one possibility.

Again, congrats and you might also look for severence/bonus tax calculators. There is also some info where they say employers can tax it at a flat 25% rate. I know times when we've received a huge bonus . . . sometimes as much as 1/3 or more gets eaten up with taxes taken out resulting in usually an over payment when we "adjust" with changing our W4 claimed dependents . . . taking care to do so within the letter of the law . . . of course.

Her boss is giving her a generous bonus.

He will want to use it as a tax deduction (business expense) in the year in which he owned his business - which he is closing soon.

SO WHAT if she pays a little more in taxes? What's so bad about being in a slightly higher tax bracket?

If you won $33,000 in the lottery, wouldn't you be grateful for the extra income.

You are all looking at what she won't get out of the bonus...not what she WILL receive. The glass is more than half full folks!

I SAID I don't recall exact date of closing . . . IF it were 12/31 . . . I'm sure he would have more expenses rolling in after that date . . . to pay . . . I also said WITHIN THE LETTER OF THE LAW . . . the is absolutely nothing wrong with strategic planning to lessen ones tax burden . . . there is good in multiple options and opinions so she can PLAN. Geez Louise. Chill Terrier.

Re: Severance Update

Preds — Thu, 24 Jul 2014 14:37:32 GMT

That's wonderful that he appreciates all that you did for him! Enjoy your bonus and your retirement. I'm sure you both will miss each other so hopefully you can stay in contact.

Re: Severance Update

RedTop — Thu, 24 Jul 2014 15:18:58 GMT

This is a great way to start your retirement! Enjoy and be happy!