I claimed ten on my $4879.00 paycheck 879 reg pay 4000 bonus and i still had 1330 in taxes taken out how is th

Question

how is that possible i wanted to do this for two months so i can ge ahead i was claiming five. whats going on?

Answer 1

The IRS allows employers to treat a bonus as a special payment, rather than as part of your regular paycheck.  When that happens, the bonus is subject to withholding at a flat 25% rate, and is not affected by the number of withholding allowances you claimed on your W-4.  Thus, you had $1,000 in federal tax withheld from your $4,000 bonus, and over $300 in FICA (Social Security/Medicare) withheld from your total pay -- or perhaps that additional amount was for your state income tax.  Looks about right to me.

Of course, next April when you calculate your actual 2008 taxes, it may turn out that they withheld more federal tax than they actually needed.  If that's the case, you'll get a refund of the extra amount.