My signing bonus is 10k and I recently received the check but it was only for 5.39k. I know NY taxes are high but this can’t be right… right???
Is there something I’m missing here or is this normal? There isn’t a tax breakdown on the bill/check so I have no idea where all of the money went. Maybe I’m just naive but paying 46% in taxes seems absurd.
I can feel my political meter swinging further to the right already.
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In college people are liberal and all for "rights", whatever tf that means. After graduating and we see how much we get taxed we then become republican. Welcome to life.
PS you'll get some of that signing bonus back come tax return.
Well those are the Republicans of yesterday. Today’s “Republicans” are quite different from the traditional OG party…
EDIT: One can’t possibly think that today’s political parties are on the same place on the spectrum as 5-10 years ago… Same thing with Democrats, how far left/right they are shifts with time.
EDIT 2: Fascinating how this is so controversial given this comment is written in general terms. Refer to my comment below for elaboration, but I’m pretty much saying (in more specific terms): Republicans have leaned more right since pre-Trump and Democrats more left. Open to constructive thoughts on why some ppl disagree.
Terrible take. If anything, the right has slowly shifted to the left of the spectrum along with the democrats.
Or maybe you understand that's the price to live in a functioning society. Would you rather live in Oklahoma or some state in BFE where the teachers make like 40k and the social services are garbage? John Lewis died in 2020, the "rights" you're talking about aren't an academic exercise
According to NerdWallet 40k in Oklahoma City is equivalent to $119k in Manhattan. For every city in Oklahoma in their dataset 40k is worth more than 100k in Manhattan and 80k or more in Brooklyn.
NYC is not a "functioning society". People shoot up subways for no reason. Crime runs rampant. The streets pile up with garbage. Hate crimes in the city are up almost 100% yoy. Yes, people are heading back to the city, but please don't conflate that with the city being a functioning society.
reminder that the trump tax cuts and jobs act will raise your taxes
People don't realize that the trump tax cuts made taxes worse for high earners in NYC
Keyword: will*
Because the Trump tax cuts reduced taxes for everyone across the board. Those who said theirs were raised are having issues, but I hear that's a misconception (John Stossel made a video about that). However, the tax cuts are not permanent, meaning that by 2024 everyone will have their taxes raised. Now why he would do this? Because 2024 is an election year, so if Democrats get elected, automatically taxes will be raised and Dems will get the blame for it. If Trump gets elected, then the tax cuts will be extended. It's a political tool! Genius Trump!
Lol there's other Republicans in NYC! Fuckin sweet, thought I was the only one
the IRS doesn’t know it’s just a signing bonus so they think that 10K is 2 weeks income. Which would mean you would be making 240K per year in the eyes of the IRS. So they over tax your signing bonus a decent amount which you should get back in the refund. I created an in depth nyc taxes sheet and if you make the 110K base salary your federal + state + local income taxes will be about 35%, and if you max out your 401K you can lower it to about 29%.
Would you mind sharing that doc?
^
Deleted
Yeah can you share? WKULD appreciate it
Please share that doc!
can I get a copy as well?
share bro, i can share something useful back if you want
Why are you all begging for a tax calculator? There are literally tons of them online, just look up “NYC income tax calculator”. You can even add 401K contributions and it will adjust your post-tax pay accordingly, lmao.
Jesus some people on this fucking site.
share as well if possible!
To piggyback off of this, you should expect to receive a hefty tax refund after your internship. Your withholdings are calculated on an annualized basis so they basically take whatever the paycheck is and assume you're making that for the entire year. That's why bonuses are taxed so high. I paid $3,500 in federal taxes on about $22,000 in income the summer of my internship and got a refund for $2,500.
I believe bonuses have higher withholding requirements in comparison to normal paychecks. But you get a decent chunk back in your refund
Would appreciate seeing this as well!
Please share if you don’t mind.
^
You'll get roughly ~$1000 of that back in taxes. Remember your company withholds for taxes based on your elections, you don't get taxed by the government upfront.
So what's happening is your company withholds taxes on the $10k check as if you make that every 2 weeks which shoots you up to the $240,000 income tax bracket.
Bonuses are taxed at a supplemental rate which in New York City is 22% for feds, 6.2% for social security, 1.45% for Medicare, 11.7% for state, and 4.25% for city. Love nyc taxes
This is the actual answer, I don’t think payroll software or companies are annualizing supplement paychecks anymore and I haven’t seen it in years
*withheld, not taxed
#Brandoned
How has any of this changed since Biden became president?
Go back to Reddit. Go defend Brandon’s honor all you want over there bro
thx
To the OP and really anyone who isn't familiar with the income tax system, it is fundamental that you understand the difference between withholdings and taxes. This will save you a whole lot of panic and heartburn when you receive your paycheck, your bonus, and when you prepare your taxes. There are loads of articles online explaining what withholdings are. It is probably a 10-15 minute time investment to understand the difference, but well worth it.
New York tax is actually pretty terrible. Worst than even "socialist" Toronto/Canada. I pay more tax in New York than I did in Toronto because the NYC city tax puts it over.
Despite the great "headline" values you earn in IBD, a bunch of things that take a big bite out of your cash comp:
1. "Normal" Taxes
2. Deferred Comp - this tends to matter the higher up you go
3. AMT - To CompBanker's comment about the difference between withholding and "taxes", you'll actually have to pay more tax (Google: Alternative Minimum Tax) when you start earning the real IBD dollars. Meaning, you won't get that refund. Uncle Sam is going to ask for another check come tax reporting time.
4. Marriage (edit): opps. This was wrong. Old info. Disregard.
Wtf. I'm a Canadian moving to NYC soon to work and I already feel like I'm overtaxed. What's your effective annual tax rate? Including the Canadian taxes or whatever they're called. Expecting to make 200k-300k.
Don't want to give away too much info, but (looking at my last pay stub) for me they are taking: 20%+ Federal tax, [low single digits%] for Medicare (I think this is a relatively fixed $ amount pp so your "rate" may be higher), 12% state, 4% city. Keep in mind in the US there is no "free healthcare" like OHIP so I pay another [low single digits%] in "benefits" for vision and dental etc. (this is for me only. The rest of my family is on my wife's benefits - long story).
Once I got promoted to (M)D level, I was paid more and got married so our combined income was pretty good... but the additional taxes I pay come tax time are pretty crap.
Things never scale as linearly as you would hope.
You can literally just look up a NYC income tax calculator and not even have to do the math yourself. How fucking incompetent are people on this website.
I don't think this has been true for years now
Correct - changed with Trump tax cuts (at least for now - maybe this changes back later this decade) so currently this is neutral.
Welcome to good ol NYC which does everything it can possible do to drive away people & innovation incl absurdly high taxes which continue to rise, doing nothing with regards to escalating black on asian violence, shrugging at rampant crime, driving away companies like Amazon, telling crypto / blockchain companies to screw off, and has firms pushing to get people back in office 3-4 days a week when in reality almost no one wants to do that
It's going to end up a cesspool of poop in 20-30yrs
As if.
The economic trend is towards cities and this is going to continue.
Cities are expanding, simply because it's more efficient to have a high concentration of workers in one location.
NYC is only going to increase in importance as time continues. And other cities will take the place of NYC if it gets too bad and they'll suffer from the same problems.
This is a misguided take. Yes, cities have been more efficient historically but couple things that are different:
1) Remote work has enabled more distributed workforces. This has never been the case throughout history -- has always been in favor of worker concentration -- but this is a structural shift. Let's say 100% of workers NEEDED to be a city 20yrs ago and about 70% of them wanted to. Now maybe only 50% NEED to be in a city, which frees up the other half. Some of them will stay because they like the city, others will move
2) You also assume everyone wants to stay in NYC. Not all will want to go rural / suburbs, but this doesn't mean they want to stay in NYC specifically. Why not an up and comer like Raleigh? Why not even relatively expensive cities like Austin / Miami which are still way cheaper than NYC? Why not in a city near one's hometown and be close to family / friends (a necessary sacrifice in the old days, but one becoming less and less a factor due to remote work)
Yes, other cities will also suffer from the same problems at some point (could be 50yrs from now, could be 200). Not arguing this point. But NYC doesn't quite have the same appeal as it did before for several key white collar industries and neither do many of the white collar industries that have made it home (IB losing out in favor of tech -- which is leading the charge of remote work & new hubs in cities like Austin / Raleigh -- i.e. not NYC).
NYC is not going to increase in importance, this flies in the face of all logic. Will abs dollars increase? Yes, I'd bet on that. Will they lose relative share to other cities / regions? Especially globally as innovation moves away from the United States towards Asia (a trend that's been underway for a decade and will only accelerate given rising internet penetration on those regions)? Almost certainly yes, which by default decreases NYC's importance as a city
Ah yes - welcome to NYC where we “eat the rich” despite the fact if you make over $100k you get absolutely bent over on taxes, rent, and general cost of living. It’s funny because when I got my IB offer I thought I was legitimately going to be a top earner (which you definitely are comparatively) but in NYC you’re just another rat in the race. Welcome to the “greatest city in the world”.
Damn you guys need better public transport from the sound of things. I'm in London, and although COL in the city is high, I have a 28minute commute and I live about 25miles out, and pay pennies for rent.
Different tax rates for ordinary income (salary) and supplemental income (bonuses)...it sucks but get used to it
This isn’t true for most roles people are talking about on this site. All of it falls under ordinary income.
I think he meant the withholding is different. Not that the actual tax expense is different.
Like most Republicans you don’t understand marginal tax rates and effective tax rates or the return of investment on public infrastructure and social welfare
I highly recommend a transfer to the Houston office, we don’t need more baby Trumpers
Ah yes, us republican finance professionals understand nothing. Thank god we have the most intelligent bureaucrats continually taking our money so that it can be spent with such efficiency on morally superior public services.
Houston take-home pay gotta be close to double what you're gettin rn G, don't hate!
It’s a good thing the federal government is all infra then. Such a dumb straw man my goodness. Also the Houston crowd can laugh their take home all the way to the bank. Keep the superiority complex though, it’s like super cool
Yes,
Theoretically they are taxing you as if you made 10k every paycheck. So this would put you in the highest tax bracket. Depending on your Salary you will recoup some at tax time.
Its not even the IRS, so much as HR and payroll/software. It is operationally easier for companies/software to have simple guidelines to follow vs having bespoke solutions for everyone. Its annoying but as others have said you'll get some back when you actually do your taxes, this is just a withholding.
It’s withheld (not taxed) at a rate that assumes that’s what you make every paycheck. There was probably a flag you could have chosen when you set withholding which could have take out at projected annual rate, but most people miss that.
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