I have a hiring bonus in my next paycheck, but it's going to cause me to get taxed to absolute shit. Can I drop my withholdings to 0 for that one paycheck or is that a no no? What should I do to maximize my take-home?
>>62508487>can I drop my withholdings to 0 for that one paycheckyes>What should I do to maximize my take-home?Make more money. Changing your witholding won't affect your take-home pay over the long term, it merely changes when you pay it. Now, or on April 15th.
>>62508487Are you part of the tribe? If no then nothing.
>>62508487Yes, you can drop your withholding. As the other anon said, it will not change your total tax for the year. The IRS doesn't much care as long as you don't end up owing a significant amount on April 15. The following is an AI summary:You avoid underpayment penalties entirely if you meet any one of these three tests:1. The 90% rule:You've paid at least 90% of the tax you actually owe for the current year through withholding and/or estimated tax payments2. The 100/110% prior year rule:You've paid 100% of last year's total tax liability through withholding and estimated payments — regardless of what you actually owe this year. This is often the easiest safe harbor to hit because you know the number in advance.The 110% version: If your prior year adjusted gross income exceeded $150,000 (or $75,000 married filing separately), you must pay 110% of last year's tax liability rather than 100% to use this safe harbor.3. The $1,000 rule:Your total underpayment is less than $1,000 after subtracting withholding
