Bonus's Taxed

SeekirRN · Jan 14, 2010

No, it will be taxed 27% for federal and 0% for state. I too live in TX, gotta love no state tax!

Once in the military you will start out with TX for your legal state of residence no matter where you move to. You can keep that as your state of legal residence your entire time you serve or you can change it to another state where you PCS.

jmaverick101 · Jan 14, 2010

I did the math if I got charged california's tax, its an extra 4500. And since my wife is also doing the same thing as me that would be 9k total. Gotta love Texas:heartbeat, it'll always be home.

surromom · Jan 15, 2010

me and my husband have received a total of 3 bonuses while active duty and the ones that got major tax taken out of them we always saw it back to us when we filed our income taxes! gotta love the bonuses getting taxed!

The Little Greek · Jan 15, 2010

me and my husband have received a total of 3 bonuses while active duty and the ones that got major tax taken out of them we always saw it back to us when we filed our income taxes! gotta love the bonuses getting taxed!

I'm glad to hear that you got back most of your taxes back, however it is not so in all cases. When I came into the AF I received $30K in sign-on and $38K in loan repayment. On those bonuses alone I was taxed $19K. When I filed my taxes that year, I had to include both on my return, and when added to my civilian and military salary as well as my husband's salary, we were bumped into a MUCH higher tax bracket. As a result, I received a $2000 refund. A far cry from the $19K that was removed from my bonuses (not to mention the tax that I paid from my salary deductions).

I would say not to count on getting much back on your return. That way if you get a massive refund you will be pleasantly surprised.

In response to the OP, I too am from TX and I live in VA. No state tax was removed from my bonus. As an aside to your original question, for anyone who is married, your spouse may now also claim your HOR for tax purposes only. What does this mean? For someone like me, my husband no longer has to pay state income tax in VA because my HOR is TX and there is no state income tax there! I posted more info about this here on page two of the post:

https://allnurses.com/government-military-nursing/servicemembers-civil-relief-418145-page2.html

Read page one about info on interest reduction rates.

carolinapooh, BSN, RN · Jan 16, 2010

I signed up for the loan repayment and bonus. I know bonus's are taxed more that normal pay. I read somewhere to apply a tax rate of about 33 percent. I live in Texas so we don't have a state tax, but my duty station after COT is in California. I know california has a state tax, will I have to apply that to my bonus.

No - if you remain a Texas resident after COT (and why you'd switch to California I have no idea), you will be taxed at 25%. I am a TX resident and got the $20K - and I took home $15K.

jmaverick101 · Jan 16, 2010

I'm glad to hear that you got back most of your taxes back, however it is not so in all cases. When I came into the AF I received $30K in sign-on and $38K in loan repayment. On those bonuses alone I was taxed $19K. When I filed my taxes that year, I had to include both on my return, and when added to my civilian and military salary as well as my husband's salary, we were bumped into a MUCH higher tax bracket. As a result, I received a $2000 refund. A far cry from the $19K that was removed from my bonuses (not to mention the tax that I paid from my salary deductions).
I would say not to count on getting much back on your return. That way if you get a massive refund you will be pleasantly surprised.
In response to the OP, I too am from TX and I live in VA. No state tax was removed from my bonus. As an aside to your original question, for anyone who is married, your spouse may now also claim your HOR for tax purposes only. What does this mean? For someone like me, my husband no longer has to pay state income tax in VA because my HOR is TX and there is no state income tax there! I posted more info about this here on page two of the post:
https://allnurses.com/government-military-nursing/servicemembers-civil-relief-418145-page2.html
Read page one about info on interest reduction rates.

I'm so glad you posted this. I was just thinking about this yesterday. I figure once they take the money it's gone forever, but I was worried about being bumped up a tax bracket. Me and my wife took the loan repayment and bonus. With the bonus's and our military pay we'll easily be in the next tax bracket.

ksk33 · Jan 16, 2010

Just curious-when do you get the bonus? Is it after you finish COT, or later, or earlier??

The Little Greek · Jan 16, 2010

Just curious-when do you get the bonus? Is it after you finish COT, or later, or earlier??

I got mine about a month after I reported to my duty station (following COT).

mobro · Jan 16, 2010

when do you sign the paperwork to officially get the bonus- at the time of commissioning? or do you just automatically get it if you signed to accept it back in the beginning of the loads of paperwork before your packet was sent?

carolinapooh, BSN, RN · Jan 17, 2010

If you EVER signed a paper saying you'd accept the bonus, and then later you sign one saying it's unavailable - the one you signed saying you'd take it will supersede the one saying you couldn't get it. And that paper was signed when you signed all that other stuff.

mt_nurse · Jan 18, 2010

just to clarify as i'm still confused... so i have NTP in arizona but will be stationed (and currently live out here in california), does that mean that the bonus and loan money i will receive will be taxed by about 30-40%?

what forms must be filled out and documents given to finally get the bonus and loan repayment? from my understanding, you get the bonus at your first duty station (which for my case will be at scottsdale). what about the loan repayment? around the same time? more paperwork? i'm confused!!!