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Tax Question....

The JugglerThe Juggler Posts: 49,293
edited December 2008 in All Encompassing Trip
Hey I was wondering if there are any accountants or anyone proficient with taxes here that can help me.

I was a part of a class action lawsuit against my former employer for overtime pay. We won and I just got my settlement yesterday. Half of my settlement came in the form of a paycheck with the appropriate taxes taken out by my employer. This as the part that as allocated to back wages.

The second part is for liquidated damages and it is just a check with no taxes taken out. So I will have to pay taxes on it come tax time. My question is how much do you think I will have to pay? Will it be the same percentage that was taken out of my back wages check? Or will it be different? The amount is $8,600. I left my accountant a voicemail but he usually takes forever to get back to me.

Anyone have any idea?
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Post edited by Unknown User on

Comments

  • The JugglerThe Juggler Posts: 49,293
    aww comON!

    no tax guys or gals in here today? help a brotha in need out!
    www.myspace.com
  • chromiamchromiam Posts: 4,114
    My guess would be that it would depend on your tax bracket. But since it isn't a large amount it could be taxed at or around the normal rate.
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  • Get_RightGet_Right Posts: 13,344
    Its taxable.
    Unless the award is for physical harm caused by the employer, most likely its taxable.
  • NothingSoundNothingSound Posts: 198
    Depends on a bunch of other stuff. You should have your accountant create a estimate of your 2008 return based on what you think you've earned and other deductions. Then add in that $8600 untaxed on top and see where it leaves you. You're going to have to pay the government something, but it might just eat away your refund (if you usually get one).
  • The JugglerThe Juggler Posts: 49,293
    NothingSound wrote:
    Depends on a bunch of other stuff. You should have your accountant create a estimate of your 2008 return based on what you think you've earned and other deductions. Then add in that $8600 untaxed on top and see where it leaves you. You're going to have to pay the government something, but it might just eat away your refund (if you usually get one).


    ok. thanks man.
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  • DonJonDonJon Posts: 5,089
    Here in Australia it would just be added to your assessable income (sure its same there) and you would pay tax based on your marginal rate. Whether it lifts you into a higher tax bracket Im not sure as I dont know what you earn and what your brackets are over there.
    I'll ride the wave where it takes me.
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