Returning a signing bonus

#2 03-17-2005, 03:57 AM

A.G. Kalman wrote:
- quote -

> markdiver wrote:

> > I recently started a new job in which they were nice enough
> > to give me a signing bonus. Unfortunately I dont like the
> > job very much and think I may leave soon.
> > > When I got the bonus I was told that if I voluntarily leave
> > within 12 months I have to pay it back, which sounds fair,
> > but the problem is that I got the bonus the first week that
> > I started, before I filled out a W2 and got hit hard on
> > taxes.
> > > My question is, if I leave this job and they ask for the
> > full amount back, do I have any recourse on my taxes ? Can I
> > deduct the full pretax amount from my income taxes next
> > year, or do I just lose out on the difference between what
> > they gave me and what I really received after tax?

> If you make a repayment in 2005 for income you were taxed on
> in 2004, you do have recourse assuming that you have a tax
> liability in 2005. The answer is on pages 31 to 32 under
> "Repayments" in IRS Pub 525.
> http://www.irs.gov/publications/index.html

Thanks !

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#1 03-17-2005, 02:59 AM

markdiver wrote:

- quote -

> I recently started a new job in which they were nice enough to give me
> a signing bonus. Unfortunately I dont like the job very much and think
> I may leave soon.
> When I got the bonus I was told that if I voluntarily leave
> within 12 months I have to pay it back, which sounds fair,
> but the problem is that I got the bonus the first week that
> I started, before I filled out a W2 and got hit hard on
> taxes.
> My question is, if I leave this job and they ask for the
> full amount back, do I have any recourse on my taxes ? Can I
> deduct the full pretax amount from my income taxes next
> year, or do I just lose out on the difference between what
> they gave me and what I really received after tax?

See the tax topic "Claim of Right." That's what you have.

Note that if under $3k, you must take the Schedule A
deduction. If over $3k, you have the choice of the
deduction or the tax credit version - and usually, people go
with the version that produces the larger tax benefit.

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

03-14-2005, 01:10 AM

markdiver wrote:

- quote -

> I recently started a new job in which they were nice enough to give me
> a signing bonus. Unfortunately I dont like the job very much and think
> I may leave soon.
> When I got the bonus I was told that if I voluntarily leave
> within 12 months I have to pay it back, which sounds fair,
> but the problem is that I got the bonus the first week that
> I started, before I filled out a W2 and got hit hard on
> taxes.
> My question is, if I leave this job and they ask for the
> full amount back, do I have any recourse on my taxes ? Can I
> deduct the full pretax amount from my income taxes next
> year, or do I just lose out on the difference between what
> they gave me and what I really received after tax?

If you make a repayment in 2005 for income you were taxed on
in 2004, you do have recourse assuming that you have a tax
liability in 2005. The answer is on pages 31 to 32 under
"Repayments" in IRS Pub 525.
http://www.irs.gov/publications/index.html

--
Alan
http://taxtopics.net

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

#-1 03-12-2005, 01:57 PM

I recently started a new job in which they were nice enough to give me
a signing bonus. Unfortunately I dont like the job very much and think
I may leave soon.

When I got the bonus I was told that if I voluntarily leave
within 12 months I have to pay it back, which sounds fair,
but the problem is that I got the bonus the first week that
I started, before I filled out a W2 and got hit hard on
taxes.

My question is, if I leave this job and they ask for the
full amount back, do I have any recourse on my taxes ? Can I
deduct the full pretax amount from my income taxes next
year, or do I just lose out on the difference between what
they gave me and what I really received after tax?

Thanks,

Mark.

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

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