Having been severed from Chevron mid year this year, I should be getting 50% CIP for 2016 in March next year. But 50% of what? Will there be a CIP for this year?
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@japq, the IRS considers anything more than zero to be income. And yes, the CIP bonus is subject to taxes, including Social Security and Medicare. If you live in California or Louisiana, you are also subject to state income tax.
Is the CIP considered earned income? Do they take out social security and Medicare taxes from it?
Yes, There will be a CIP bonus for 2016, just as there was one for 2015, when people were asking the same question. One must keep in mind the CIP is also something paid to supervisors and managers up to PSG 26, so these higher-paid employees count on getting their bonuses too. In Chevron, the CIP bonus formula benefits the higher PSG salary grades because of the factor attributed to their pay grade. It seems very unfair that the higher paids effectively receive a larger bonus payout, percentage-wise. In any case, that is the reason why there will be a CIP bonus in 2016. The amount of the CIP bonus money to be distributed will be determined by John Watson and the BOD. There is a budget for everything.