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Marvin,EA
Marvin,EA, Enrolled Agent
Category: Tax
Satisfied Customers: 1672
Experience:  Enrolled to Represent Taxpayers Before The IRS
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if i take a buyout from my employer,will they take a percentage

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if i take a buyout from my employer,will they take a percentage of it.or will they just deduct my normal judgement amount?
Submitted: 8 years ago.
Category: Tax
Expert:  Marvin,EA replied 8 years ago.
Hello and thank you for using Just Answer. If you receive a buyout from your employer 25% will be withheld from your buyout. If you child support judgement is $165.00 only $165.00 will be withheld from the buyout.
Customer: replied 8 years ago.

does that answer my question about filing exempt? will i only pay state tax and no federal tax. i guess i don't understand "employer tax". could you please explain.

 

 

Expert:  Marvin,EA replied 8 years ago.
When a person received supplemental wages a flat tax in the amount of 25% is withheld from the amount received. Supplemental wages are bonuses, commissions, overtime pay, buyout pay. It does not matter if a person file for exempt from federal income tax from their regular wages, the 25% will still be withheld from the supplemental wages. The supplemental wages is also subject to FICA tax in the amount of 7.65% of the amount receive. There is a limited on the amount of deduction of Social Security tax withheld. If the total of all income received is over $97,500 no Social Security tax (6.20%) will be withheld on amount over $97,500. Medicare tax in the amount of 1.45% will still be withheld on amount over $97,500.
Customer: replied 8 years ago.
so how much should i expect from $100,000.00 then if i file exempt? other than the $165.00 judgement. ball park.
Expert:  Marvin,EA replied 8 years ago.
You should expect to receive about $67,500 from your buyout after all taxes ( state and federal) are withheld from your buyout.
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