While getting a severance and a bonus would be awesome - if it's all paid out in 2023 on top of earnings already in the books...some could see their tax rate jump significantly meaning that you will lose so much more of the "gift" of a few months of your regular pay...still hoping that the payouts can happen in Jan. or are grossed up for extra taxes. Give me Oct 30th or Nov 1st.
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Only the extra cash over your annual pay would be taxed at the higher rate. Your first x0,000 are still going to be taxed exactly the same regardless of whether you quit and don't get severance or if you're laid off and get severance.
if it happens this year it will kick me way over my Roth income limits
Single Filers Married Joint Returns Heads of Households
10% $0 to $11,000 $0 to $22,000 $0 to $15,700
12% $11,000 to $44,725 $22,000 to $89,450 $15,700 to $59,850
22% $44,725 to $95,375 $89,450 to $190,750 $59,850 to $95,350
24% $95,375 to $182,100 $190,750 to $364,200 $95,350 to $182,100
32% $182,100 to $231,250 $364,200 to $462,500 $182,100 to $231,250
35% $231,250 to $578,125 $462,500 to $693,750 $231,250 to $578,100
37% $578,125 or more $693,750 or more $578,100 or more
Source: Internal Revenue Service
That’s why the EC is delaying… out of the kindness of their hearts. 🤣😂🤣😂