Trip not on paycheck stub?

[wayneallenfunk]

What is the name of your state?NC

I recently won a trip to Hawaii through my company which I was told had a value of approximately $18000. Two days after I returned I was terminated. I was told before the trip was made that this would be classified as income on my paycheck and that the company would pay the taxes on my behalf. I just recently got my last paycheck today and the trip is not showing up on my paystub. I know that this is a lot of income to show on my income but the taxes next year would be almost like another bonus. Will this show up later or are they allowed since I am terminated not to show on my income? Any thoughts?

 

[pattytx]

Although theoretically, this should have been added to your W-2 earnings at the time it was awarded. In practice, as long as it gets done before your W-2 is issued, you should be fine. Since they said they are going to pay the taxes as well, you should expect a higher amount than $1,800, however. At 25% FIT, 6.2% FICA, 1.45% Medicare and whatever supplemental rate NC uses, I would expect at least $2,500, because the taxes they pay on your behalf are taxable. I can give you firmer numbers tomorrow from work.

 

[wayneallenfunk]

The trip had an approximate value of $18,000. Your numbers will be a great help so that I can plan out the rest of my year on what I need to pay in taxes. Thanks

 

[pattytx]

North Carolina's supplemental rate is 6%. So, if the employer grosses up the trip value (pays all the related employment taxes on your behalf, including income taxes), the additional amount on your W-2 would be just about $29,340. Of course you will also show the additional 25% FIT as withheld ($7,335) and the additional 6% NC SIT ($1,760), plus the related FICA and Medicare taxes on the full $29,340.

If you have further questions, please let me know.

 

[pattytx]

I can't find my document, but if you repay the gross amount, they have to give you a W-2C reflecting the reduction in FICA and Medicare taxes and refund those taxes only. You can claim the difference as an itemized deduction, if my memory serves me correctly. Your tax preparer should be able to advise you on this. If you use one of the big services like Jackson-Hewitt or H&R Block, they will normally not charge you a fee for advise like this.