How would you save as much as possible by not letting Uncle Sam eat it.
Bonuses are taxed at the same rate as normal income so no special handling is required. But in general depositing into tax advantages accounts, home ownership, charitable donations, etc will help reduce tax burden.
The only ways I know are illegal
Enlighten us
It's super hard to do illegal shit as an employee. Most people have all their wages/bonuses/equity reported to the IRS by their employer, and hold their investment incomes through a company like Vanguard or Fidelity that also reports. People who are even able to avoid taxes illegally are usually self-employed or have very high investment income they've moved offshore.
Put a higher % of it into 401k...that way you defer the taxes.
I do the opposite. I turn off my 401k so the entire bonus isnt touched by my 401k. It doesnt help w taxes (which are unavoidable anyway) but i know im getting as much of my bonus as possible that would otherwise be affected by the 401k %
It depends what you expect your tax rate after retirement to be. If you expect to earn more in your retirement days than today, what you said makes sense. If not, it's better to defer the taxes so that a lower rate is applied to them when you take them out
Move somewhere with lower tax rates
Always max your pre-tax 401k. And then put the rest in post-tax 401k, with daily conversion into Roth. Defer all taxes!
You would think the people that frequent Blind would be smart enough to notice that there is no special line in their tax forms for bonuses and that they are actually taxed at the same rate as standard income. 🤦🏻♂️
Last I checked, Blind was full of people working at tech companies...not CPAs working for the Big 4 Amazes me that some people expect a person with no formal training in the topic to have a solid grasp of US tax law.
Dude, you really think this is complicated? 😂 Formal training needed? 🤣 Did you even read my post? How simple this concept is?
Pay your fucking taxes. You probably want billionaires to pay more but at same time wanting to pay less yourself, you fucking hypocrite.
You must follow the same strategies that are used for saving income taxes. There isn't anything special for bonuses. 401k, HSA, ...
Cayman Islands.
Not earning money from bonuses is the best way.
What rating do I need to get for that ?
You can always move to a smaller company with less pay, we don't get any bonuses here.