Somehow related to HP Calculators

[Albert Chan]

(01-04-2022 04:21 PM)Maximilian Hohmann Wrote:  I always paid my taxes in Germany. Here, bonus payments at the end of the year are something one tries to avoid as an employee since they are heavily taxed. I would prefer a 50 Euro montly increase over a single 1000 Euro bonus in December (even if on paper it almost looks like double).

My guess is bonus seemed to be heavily taxed due to progressive tax structure.
But, at the end of the day, you'd owe the same taxes either way, 1 time bonus or spread-out over the year.

Here's why your bonus is taxed so high

Quote:It comes down to what's called "supplemental income." Although all of your earned dollars are equal at tax time, when bonuses are issued, they're considered supplemental income by the IRS and held to a higher withholding rate.