I’ve started my role for a tech company and I’m here for about a month. I got my sign on bonus. I don’t like the company culture, it is toxic. If I quit, I need to return the sign on bonus. Can I address this to IRS for the next tax return period? Because I have to return the whole amount and I quit less than one year.
You'll get a refund down the line, but will be short money in the meantime. This is why companies have these policies.
If you repay within the same tax year as when you received the sign in bonus, you should only repay the post-tax amount and it is up to the employer to recover the tax/social security amount themselves. If you repay within a subsequent year, you repay the pre tax amount, your company should issue a W2C, and you can recover the tax via tax return; after you repay, your company should refund you the social security because they are the ones that have to recover it in most instances. At least that’s how it works at my company.
This is why it is better to start a new job at the start of the year.
I paid the sign on back in 2022. My previous company had a policy that if return before Dec 1 of the same year i got my money in, they want me to only return the money i got post taxes. I did that and my W2 did not have anything about my sign on. Clean slates. Its probably because that tax money is with the employer until end of the year. So if you return them what you got, they can pull that money back from the account hey witheld the taxes in. Win win.
Have you joined Deloitte OP?
When you file your 2023 tax return the amount withheld from your sign on bonus is accounted for.
Thanks. So I can ask for it right?
Yes