FIT Again

In this pay, the president of the company, Joseph O'Neill, paid his annual bonus.

This does not affect O'Neill's insurance coverage, which based on regular pay.

This year, his bonus is $60,000. For withholding purposes, the bonus considered a supplemental payment and added to his gross pay, and the aggregate amount taxed. For this pay, O'Neill has increased SIMPLE deduction to $4,000.

To determine the federal income tax, use the Table of Allowance Values along with Tax Table A (pages T-2 to T-4).

In calculating the tax, do not round the aggregate to the nearest earnings dollar.

In this pay, O'Neill has reached the OASDI ceiling. To calculate O'Neill's OASDI tax, multiply the OASDI ceiling of $113,700 by 6.2 percent and then subtract the year-to-date OASDI taxes withheld.