Did you get an Unexpected Year End Bonus because of the Tax Cut?

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Locked
cherijoh
Posts: 4990
Joined: Tue Feb 20, 2007 4:49 pm
Location: Charlotte NC

Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by cherijoh » Sun Dec 31, 2017 9:49 pm

I have been off from work since before Christmas and have avoided logging into my work computer. But a friend told me this afternoon that she had heard that my Megacorp employer gave all employees (below a certain salary cap) a $1K bonus this week because of the corporate tax cut. So I logged into my checking account and lo and behold there was an unexpected ACH deposit for a bit over $600 from my employer.

I'm curious as to whether anyone else received an unexpected bonus before the end of the year and if so, how generous was your employer?

Mike Scott
Posts: 1047
Joined: Fri Jul 19, 2013 2:45 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by Mike Scott » Sun Dec 31, 2017 9:55 pm

With increasing health insurance premiums, I am getting a pay cut starting tomorrow.

User avatar
jhfenton
Posts: 3535
Joined: Sat Feb 07, 2015 11:17 am
Location: Ohio

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by jhfenton » Sun Dec 31, 2017 10:01 pm

My mini-megacorp (S&P 600 company) gave all employees a 3% "bonus" in our last paycheck on Friday. They also prepaid 90% of our Q4 bonus the Friday before. (Our Q4 bonus is usually payable the following February and includes the true-up for our annual bonus based on all the year-end numbers. Q1-Q3 all pay out at 90% of potential with the true-up coming after year-end.)

For some reason, tax bill or otherwise, they wanted more cash out the door in 2017 than in 2018.

The email they sent, though, may it clear that the 3% bonus is not really a bonus. It is in lieu of any 2018 merit increases. And our health insurance premiums are going up modestly.

(On the plus side, my wife starts a new job in a week, and her health insurance is much cheaper. She and the kids will be jumping to hers, while I stay on mine. Mine is really cheap for employees, fairly cheap for employees+kids, and much more expensive for employee+spouse(+kids). So in February, our net benefit costs will go down quite a bit.)

Traveler
Posts: 657
Joined: Fri Aug 30, 2013 9:07 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by Traveler » Sun Dec 31, 2017 10:22 pm

No, but my benefits cost less next year (LTD, health, dental) and I can put $50 more into my HSA and $500 more into my 401K

Dottie57
Posts: 4806
Joined: Thu May 19, 2016 5:43 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by Dottie57 » Sun Dec 31, 2017 10:26 pm

cherijoh wrote:
Sun Dec 31, 2017 9:49 pm
I have been off from work since before Christmas and have avoided logging into my work computer. But a friend told me this afternoon that she had heard that my Megacorp employer gave all employees (below a certain salary cap) a $1K bonus this week because of the corporate tax cut. So I logged into my checking account and lo and behold there was an unexpected ACH deposit for a bit over $600 from my employer.

I'm curious as to whether anyone else received an unexpected bonus before the end of the year and if so, how generous was your employer?
You are kidding, right?!

sambb
Posts: 2196
Joined: Sun Mar 10, 2013 3:31 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by sambb » Sun Dec 31, 2017 10:50 pm

i have a friend who recieved 500$, same reason. he is a lower level employee.

User avatar
birdog
Posts: 169
Joined: Fri Apr 07, 2017 1:35 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by birdog » Sun Dec 31, 2017 11:06 pm

I was expecting a Christmas bonus, like I get every year, but this year I got a one year subscription to the jelly-of-the-month club. I was NOT happy because I was going to use the money to put in a pool in the spring.

WolfgangPauli
Posts: 263
Joined: Sun Aug 23, 2015 8:28 am

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by WolfgangPauli » Sun Dec 31, 2017 11:20 pm

jhfenton wrote:
Sun Dec 31, 2017 10:01 pm
My mini-megacorp (S&P 600 company) gave all employees a 3% "bonus" in our last paycheck on Friday. They also prepaid 90% of our Q4 bonus the Friday before. (Our Q4 bonus is usually payable the following February and includes the true-up for our annual bonus based on all the year-end numbers. Q1-Q3 all pay out at 90% of potential with the true-up coming after year-end.)

For some reason, tax bill or otherwise, they wanted more cash out the door in 2017 than in 2018.

The email they sent, though, may it clear that the 3% bonus is not really a bonus. It is in lieu of any 2018 merit increases. And our health insurance premiums are going up modestly.

(On the plus side, my wife starts a new job in a week, and her health insurance is much cheaper. She and the kids will be jumping to hers, while I stay on mine. Mine is really cheap for employees, fairly cheap for employees+kids, and much more expensive for employee+spouse(+kids). So in February, our net benefit costs will go down quite a bit.)
In a weird way, what benefits them hurts you. So, if they had paid that bonus out tomorrow, you likely would have been in a lower tax bracket. They wanted to pay it early as they are in a much higher tax bracket now then they will be on 1 Jan and can deduct it. So, you would have been better off (likely) if they had waited... they are much better off by not waiting.
Twitter: @JAXbogleheads | EM: JAXbogleheads@gmail.com

WL2034
Posts: 473
Joined: Tue May 21, 2013 10:36 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by WL2034 » Sun Dec 31, 2017 11:21 pm

birdog wrote:
Sun Dec 31, 2017 11:06 pm
I was expecting a Christmas bonus, like I get every year, but this year I got a one year subscription to the jelly-of-the-month club. I was NOT happy because I was going to use the money to put in a pool in the spring.
That truly is the gift that keeps on giving the whole year. Congratulations!

User avatar
Nestegg_User
Posts: 1138
Joined: Wed Aug 05, 2009 1:26 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by Nestegg_User » Sun Dec 31, 2017 11:22 pm

birdog wrote:
Sun Dec 31, 2017 11:06 pm
I was expecting a Christmas bonus, like I get every year, but this year I got a one year subscription to the jelly-of-the-month club. I was NOT happy because I was going to use the money to put in a pool in the spring.
I hope you found that light not working on your string of lights ... and you might want to check your switches before you check all of them again

User avatar
jhfenton
Posts: 3535
Joined: Sat Feb 07, 2015 11:17 am
Location: Ohio

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by jhfenton » Sun Dec 31, 2017 11:36 pm

WolfgangPauli wrote:
Sun Dec 31, 2017 11:20 pm
In a weird way, what benefits them hurts you. So, if they had paid that bonus out tomorrow, you likely would have been in a lower tax bracket. They wanted to pay it early as they are in a much higher tax bracket now then they will be on 1 Jan and can deduct it. So, you would have been better off (likely) if they had waited... they are much better off by not waiting.
And don't think I'm going to let my CFO forget it! :sharebeer

User avatar
munemaker
Posts: 3588
Joined: Sat Jan 18, 2014 6:14 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by munemaker » Mon Jan 01, 2018 1:15 am

It is wonderful that so many companies are giving the year end bonus or wage increases in as a result of the tax cut.

I am retired so no bonus for me, but I am happy for those who did receive a bonus.

Wagnerjb
Posts: 7203
Joined: Mon Feb 19, 2007 8:44 pm
Location: Houston, Texas

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by Wagnerjb » Mon Jan 01, 2018 2:10 am

munemaker wrote:
Mon Jan 01, 2018 1:15 am
It is wonderful that so many companies are giving the year end bonus or wage increases in as a result of the tax cut.

I am retired so no bonus for me, but I am happy for those who did receive a bonus.
+1
Andy

jackholloway
Posts: 965
Joined: Mon Jul 08, 2013 3:45 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by jackholloway » Mon Jan 01, 2018 3:26 am

Nope. None of my personal friends got unexpected bonuses, and many of expect notable tax and health insurance price increases in 2018. I know a few people at the companies that announced the bonuses also got surprise layoffs this last week. I keep getting reminded that no job is truly safe.

For those for whom it did work out well, of course, I hope they enjoy the unexpected windfall. Very nice when it happens, and it is well worth savoring.

It also goes to show that predicting the future based on existing policy is fraught, and the whole “no discussion of potential policy” rule on bogleheads saves sturm und drang.

Valuethinker
Posts: 36703
Joined: Fri May 11, 2007 11:07 am

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by Valuethinker » Mon Jan 01, 2018 6:58 am

cherijoh wrote:
Sun Dec 31, 2017 9:49 pm
I have been off from work since before Christmas and have avoided logging into my work computer. But a friend told me this afternoon that she had heard that my Megacorp employer gave all employees (below a certain salary cap) a $1K bonus this week because of the corporate tax cut. So I logged into my checking account and lo and behold there was an unexpected ACH deposit for a bit over $600 from my employer.

I'm curious as to whether anyone else received an unexpected bonus before the end of the year and if so, how generous was your employer?
Corporation tax rate goes from 35 per cent to 21per cent on Jan 1st.

1000 dollars paid in 2017 to employees costs them 650 dollars. It costs them 790 dollars in 2018.

CFO just saved employer 140 bucks. Shareholders will benefit.

User avatar
jharkin
Posts: 1911
Joined: Mon Mar 28, 2016 7:14 am
Location: Boston suburbs

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by jharkin » Mon Jan 01, 2018 8:12 am

Valuethinker wrote:
Mon Jan 01, 2018 6:58 am
cherijoh wrote:
Sun Dec 31, 2017 9:49 pm
I have been off from work since before Christmas and have avoided logging into my work computer. But a friend told me this afternoon that she had heard that my Megacorp employer gave all employees (below a certain salary cap) a $1K bonus this week because of the corporate tax cut. So I logged into my checking account and lo and behold there was an unexpected ACH deposit for a bit over $600 from my employer.

I'm curious as to whether anyone else received an unexpected bonus before the end of the year and if so, how generous was your employer?
Corporation tax rate goes from 35 per cent to 21per cent on Jan 1st.

1000 dollars paid in 2017 to employees costs them 650 dollars. It costs them 790 dollars in 2018.

CFO just saved employer 140 bucks. Shareholders will benefit.
Gotta love all that “job creation”
:oops:

User avatar
obafgkm
Posts: 300
Joined: Fri Mar 11, 2016 9:12 am
Location: Pennsylvania

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by obafgkm » Mon Jan 01, 2018 8:16 am

As an employee of a non-profit (a college), I am amazed by many (but not all) posters assuming a bonus is guaranteed (either the existence of one or an amount). As I see it, if it is guaranteed, it would be salary. Or maybe I don't understand the meaning of bonus in the corporate world?

AntsOnTheMarch
Posts: 610
Joined: Mon May 29, 2017 5:47 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by AntsOnTheMarch » Mon Jan 01, 2018 8:18 am

Then there’s this:
After announcing that the majority of its United States employees would receive a $1,000 holiday bonus as a result of the new GOP tax plan, AT&T quietly laid off more than 1,000 employees.

https://www.salon.com/2017/12/27/att-sh ... t-bonuses/
Last edited by AntsOnTheMarch on Mon Jan 01, 2018 8:21 am, edited 1 time in total.

Jack FFR1846
Posts: 8104
Joined: Tue Dec 31, 2013 7:05 am

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by Jack FFR1846 » Mon Jan 01, 2018 8:21 am

The Megacorp I work for paid a negative 35%, so I guess with a 21% new tax rate, that's an increase of 56%. No soup for you!
Bogle: Smart Beta is stupid

User avatar
jhfenton
Posts: 3535
Joined: Sat Feb 07, 2015 11:17 am
Location: Ohio

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by jhfenton » Mon Jan 01, 2018 8:31 am

obafgkm wrote:
Mon Jan 01, 2018 8:16 am
As an employee of a non-profit (a college), I am amazed by many (but not all) posters assuming a bonus is guaranteed (either the existence of one or an amount). As I see it, if it is guaranteed, it would be salary. Or maybe I don't understand the meaning of bonus in the corporate world?
It's a bit of both. We have quarterly payouts from an official incentive plan that everyone, including the company, unofficially calls bonuses. The Board of Directors has to approve them each quarter (paid out at 90-95% of potential for the first three quarters and then trued up after Q4), and they are not technically guaranteed. The factors involved in the calculation--e.g. company results, department results, personal attendance, even customer survey satisfaction scores one year--can change a bit from year to year. But ultimately, in the 9 years I've been there, they've never been not been paid, and the payout percentage has always varied between 102% and 109% of Base Incentive. "Base Incentive" means 10% of salary for managers and below, 20% for directors, and 30% for VPs.

They have also, a few times in my 9 years, paid out unexpected year-end bonuses. Twice it was maybe 1%ish, at least for me. This year, it was announced as 3% in lieu of 2018 salary increases.

Our sales folks also have their own separate bonus and rewards programs with the money, prizes, and trips you would expect. I don't pay much attention, except when I have to review a contract for one of the trips.

cherijoh
Posts: 4990
Joined: Tue Feb 20, 2007 4:49 pm
Location: Charlotte NC

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by cherijoh » Mon Jan 01, 2018 8:40 am

I was trying to make my original post in a neutral, non-political way to abide by board rules. I was simply curious if other companies had used the same tactic. But I'm not oblivious to the fact that I had to pay a higher tax rate because the company paid it out by the end of the year. I fully expect to read about my Megacorp doing more stock buybacks in the coming year.

But it was totally unexpected, so $600 bucks is better than nothing - it funded some of the extra charitable giving that I made before the end of the year - which I did in part to make the tax plan work in my favor. :wink:

Now I would be :annoyed if they had pushed most of our year end bonus into 2017 like jhfenton's company did. Our "bonus" (really variable compensation) is also paid in February and has in the past few year's equaled between 9 - 14% of my total compensation for the year. I'm planning to retire this year (2018) - probably at the end of 1Q. So I would have paid an even higher tax differential if I had gotten it in 2017 vs. 2018. I plan to up my % contribution to my 401k so that most of the bonus gets tax deferred and I have more room to do Roth conversions this year.

jhfenton wrote:
Sun Dec 31, 2017 10:01 pm

My mini-megacorp (S&P 600 company) gave all employees a 3% "bonus" in our last paycheck on Friday. They also prepaid 90% of our Q4 bonus the Friday before. (Our Q4 bonus is usually payable the following February and includes the true-up for our annual bonus based on all the year-end numbers. Q1-Q3 all pay out at 90% of potential with the true-up coming after year-end.)

For some reason, tax bill or otherwise, they wanted more cash out the door in 2017 than in 2018.

The email they sent, though, may it clear that the 3% bonus is not really a bonus. It is in lieu of any 2018 merit increases. And our health insurance premiums are going up modestly.

cherijoh
Posts: 4990
Joined: Tue Feb 20, 2007 4:49 pm
Location: Charlotte NC

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by cherijoh » Mon Jan 01, 2018 8:41 am

Jack FFR1846 wrote:
Mon Jan 01, 2018 8:21 am
The Megacorp I work for paid a negative 35%, so I guess with a 21% new tax rate, that's an increase of 56%. No soup for you!
:confused

User avatar
JonnyDVM
Posts: 1606
Joined: Wed Feb 12, 2014 6:51 pm
Location: Atlanta, GA

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by JonnyDVM » Mon Jan 01, 2018 8:45 am

I asked my boss if we would all be getting a raise since the corporate tax rate was going down so sharply. I got an lol.
Sometimes the questions are complicated and the answers are simple. -Dr. Seuss

Dandy
Posts: 5475
Joined: Sun Apr 25, 2010 7:42 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by Dandy » Mon Jan 01, 2018 8:55 am

Great that several companies are sharing some of their tax cut benefits with their employees even before the firms have actually experienced the actual tax benefit. So you don't look a gift horse in the mouth.

One goal of the corporate tax cut was to increase the wages of the middle class. I hope companies will increase the salaries of their workers (and/or hire additional workers) eventually so there would be an ongoing benefit. It is early yet so maybe that will occur so that the US can see some middle class wages on the rise - a good thing for all concerned.

alfaspider
Posts: 1621
Joined: Wed Sep 09, 2015 4:44 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by alfaspider » Mon Jan 01, 2018 8:57 am

obafgkm wrote:
Mon Jan 01, 2018 8:16 am
As an employee of a non-profit (a college), I am amazed by many (but not all) posters assuming a bonus is guaranteed (either the existence of one or an amount). As I see it, if it is guaranteed, it would be salary. Or maybe I don't understand the meaning of bonus in the corporate world?
In my industry (big oil), it is pretty standard to have a “target bonus” that is a certain percentage of your salary. The target bonus is then multiplied by a company performance and a personal performance factor. Getting stiffed only happens if the company is in dire straits or the employee got a rock bottom performance rating. It’s better understood as deferred compensation.

As to the concept itself- it’s funny that people think this is companies “sharing the wealth.” It’s simply a matter of accelerating deductions.

metacritic
Posts: 305
Joined: Fri Oct 05, 2007 12:58 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by metacritic » Mon Jan 01, 2018 9:04 am

Edited for civility (but note I vigorously disagree with this thread and see it as a continuation of political discussion by other means).
Last edited by metacritic on Mon Jan 01, 2018 9:22 am, edited 1 time in total.

bgf
Posts: 662
Joined: Fri Nov 10, 2017 9:35 am

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by bgf » Mon Jan 01, 2018 9:08 am

No bonus. Health insurance has increased.
“TE OCCIDERE POSSUNT SED TE EDERE NON POSSUNT NEFAS EST"

cherijoh
Posts: 4990
Joined: Tue Feb 20, 2007 4:49 pm
Location: Charlotte NC

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by cherijoh » Mon Jan 01, 2018 9:16 am

obafgkm wrote:
Mon Jan 01, 2018 8:16 am
As an employee of a non-profit (a college), I am amazed by many (but not all) posters assuming a bonus is guaranteed (either the existence of one or an amount). As I see it, if it is guaranteed, it would be salary. Or maybe I don't understand the meaning of bonus in the corporate world?
That's why I generally use quotes around "bonus". The corporate world figured out they could save money by splitting out salary into base pay and some form of separate payment based on performance once a year (or once a quarter). IIRC I started getting paid this way sometime in the early to mid 90s. This is also why so many people in the corporate world job hop to get their compensation up.

For my current employer this once-a-year payout is based on both company performance (which determines the size of the "bonus" pool) and individual performance (which dictates how much of the pool -if any - that you get). Anyone who gets an OK or better performance rating will get something each year. And the higher up in the organization you are, the bigger the pool as a percentage of salary.

Even during the recession, there was some money in the pool albeit less than in good economic times. So in that way it is sort of guaranteed - although not in the same way as a sales person's commission is laid out in advance (if they sell $x they will get $y in commission). And it is outlined in HR materials about how compensation works.

With this structure, annual raises are a lot lower (quite often NOT keeping up with inflation unless you get a super performance review or a promotion). This mitigates the impact of compounding in a way that is very unfavorable to the EMPLOYEE, but very favorable for the EMPLOYER.

notmyhand
Posts: 306
Joined: Mon Jul 15, 2013 7:43 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by notmyhand » Mon Jan 01, 2018 9:29 am

My Christmas bonus was more than double the usual amount.

lostdog
Posts: 1294
Joined: Thu Feb 04, 2016 2:15 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by lostdog » Mon Jan 01, 2018 9:30 am

Trickle down...

We'll see.

User avatar
Kenkat
Posts: 4452
Joined: Thu Mar 01, 2007 11:18 am
Location: Cincinnati, OH

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by Kenkat » Mon Jan 01, 2018 9:46 am

I don’t work there, but 5/3 Bank here in Cincinnati reportedly gave bonuses of $1k and raised minimum salaries to $15 per hour after the tax cut passed.

finite_difference
Posts: 1089
Joined: Thu Jul 09, 2015 7:00 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by finite_difference » Mon Jan 01, 2018 9:51 am

Dandy wrote:
Mon Jan 01, 2018 8:55 am
Great that several companies are sharing some of their tax cut benefits with their employees even before the firms have actually experienced the actual tax benefit. So you don't look a gift horse in the mouth.

One goal of the corporate tax cut was to increase the wages of the middle class. I hope companies will increase the salaries of their workers (and/or hire additional workers) eventually so there would be an ongoing benefit. It is early yet so maybe that will occur so that the US can see some middle class wages on the rise - a good thing for all concerned.
Companies like giving out bonuses because unlike a salary increase, they can always decrease or cut it. So a bonus is a very low risk means of compensation.

No change in our bonuses.
The most precious gift we can offer anyone is our attention. - Thich Nhat Hanh

JDTHOOSIER
Posts: 56
Joined: Tue Jun 13, 2017 6:09 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by JDTHOOSIER » Mon Jan 01, 2018 9:57 am

metacritic wrote:
Mon Jan 01, 2018 9:04 am
Edited for civility (but note I vigorously disagree with this thread and see it as a continuation of political discussion by other means).
Agreed. Any bonuses/pay raises at this early point is just political theater by the megacorps.

nolesrule
Posts: 829
Joined: Thu Feb 26, 2015 10:59 am

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by nolesrule » Mon Jan 01, 2018 10:05 am

We got a surprise end of year bonus if we were employed with the company since July 1, but we also got one last year. And last year's was bigger.

Sadly, it was not included in the payroll check, but as a separate check, and was processed after the payroll check even though they had the same date. So I ended up missing out on $24.16 in 401k matching because my payroll check maxed out the 401k for the year. They do 401k contributions/match on bonuses, and we get quarterly performance bonuses, which makes it fun doing the contribution math.

Lonestarz
Posts: 97
Joined: Sat Oct 14, 2017 8:40 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by Lonestarz » Mon Jan 01, 2018 10:08 am

No bonus for SO or myself - healthcare went up significantly.

User avatar
jhfenton
Posts: 3535
Joined: Sat Feb 07, 2015 11:17 am
Location: Ohio

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by jhfenton » Mon Jan 01, 2018 10:15 am

nolesrule wrote:
Mon Jan 01, 2018 10:05 am
Sadly, it was not included in the payroll check, but as a separate check, and was processed after the payroll check even though they had the same date. So I ended up missing out on $24.16 in 401k matching because my payroll check maxed out the 401k for the year. They do 401k contributions/match on bonuses, and we get quarterly performance bonuses, which makes it fun doing the contribution math.
It was a close thing for me. Fortunately they put our 3% "bonus" on our final payroll check, so it worked out. If they had split them, I would have lost ~$130 in match.

vested1
Posts: 1616
Joined: Wed Jan 04, 2012 4:20 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by vested1 » Mon Jan 01, 2018 10:34 am

AntsOnTheMarch wrote:
Mon Jan 01, 2018 8:18 am
Then there’s this:
After announcing that the majority of its United States employees would receive a $1,000 holiday bonus as a result of the new GOP tax plan, AT&T quietly laid off more than 1,000 employees.

https://www.salon.com/2017/12/27/att-sh ... t-bonuses/
As a former employee of AT&T, this was expected. Every year the carrot was dangled but oddly remained out of reach, or more accurately, had already been chewed. But hey, maybe with the announcement of that $1,000 bonus the merger with Time Warner might get approved.

vested1
Posts: 1616
Joined: Wed Jan 04, 2012 4:20 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by vested1 » Mon Jan 01, 2018 10:36 am

Dandy wrote:
Mon Jan 01, 2018 8:55 am
Great that several companies are sharing some of their tax cut benefits with their employees even before the firms have actually experienced the actual tax benefit. So you don't look a gift horse in the mouth.

One goal of the corporate tax cut was to increase the wages of the middle class. I hope companies will increase the salaries of their workers (and/or hire additional workers) eventually so there would be an ongoing benefit. It is early yet so maybe that will occur so that the US can see some middle class wages on the rise - a good thing for all concerned.
There's a glass half full, and a glass half empty. Occasionally we see a glass overflowing.

Dottie57
Posts: 4806
Joined: Thu May 19, 2016 5:43 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by Dottie57 » Mon Jan 01, 2018 10:45 am

cherijoh wrote:
Mon Jan 01, 2018 9:16 am
obafgkm wrote:
Mon Jan 01, 2018 8:16 am
As an employee of a non-profit (a college), I am amazed by many (but not all) posters assuming a bonus is guaranteed (either the existence of one or an amount). As I see it, if it is guaranteed, it would be salary. Or maybe I don't understand the meaning of bonus in the corporate world?
That's why I generally use quotes around "bonus". The corporate world figured out they could save money by splitting out salary into base pay and some form of separate payment based on performance once a year (or once a quarter). IIRC I started getting paid this way sometime in the early to mid 90s. This is also why so many people in the corporate world job hop to get their compensation up.

For my current employer this once-a-year payout is based on both company performance (which determines the size of the "bonus" pool) and individual performance (which dictates how much of the pool -if any - that you get). Anyone who gets an OK or better performance rating will get something each year. And the higher up in the organization you are, the bigger the pool as a percentage of salary.

Even during the recession, there was some money in the pool albeit less than in good economic times. So in that way it is sort of guaranteed - although not in the same way as a sales person's commission is laid out in advance (if they sell $x they will get $y in commission). And it is outlined in HR materials about how compensation works.

With this structure, annual raises are a lot lower (quite often NOT keeping up with inflation unless you get a super performance review or a promotion). This mitigates the impact of compounding in a way that is very unfavorable to the EMPLOYEE, but very favorable for the EMPLOYER.

This is my employer as well. Unfortunately my employer also goes with a model where only top 30% get bonus. I've been lucky. However it creates a divide in the work group which can become a chasm.

I doubt the new law will help wage earners. I hope I am wrong.

cherijoh
Posts: 4990
Joined: Tue Feb 20, 2007 4:49 pm
Location: Charlotte NC

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by cherijoh » Mon Jan 01, 2018 11:04 am

Dottie57 wrote:
Mon Jan 01, 2018 10:45 am
This is my employer as well. Unfortunately my employer also goes with a model where only top 30% get bonus. I've been lucky. However it creates a divide in the work group which can become a chasm.

I doubt the new law will help wage earners. I hope I am wrong.
Unfortunately, I suspect you are right. Especially wage earners below ~75th percentile for salary and/or those who are not eligible for a good workplace health insurance plan. We continue to widen the divide between the have and have nots.

chw
Posts: 484
Joined: Thu May 24, 2012 4:22 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by chw » Mon Jan 01, 2018 11:08 am

Wagnerjb wrote:
Mon Jan 01, 2018 2:10 am
munemaker wrote:
Mon Jan 01, 2018 1:15 am
It is wonderful that so many companies are giving the year end bonus or wage increases in as a result of the tax cut.

I am retired so no bonus for me, but I am happy for those who did receive a bonus.
+1
+2 :beer

annielouise
Posts: 354
Joined: Wed May 14, 2008 4:11 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by annielouise » Mon Jan 01, 2018 11:09 am

SO did not. Benefit cost is virtually unchanged. Last year's raise was .7%, which added to the last 10 years of raises is about 4% total. We are certainly falling behind inflation. Bonuses have been steadily shrinking in recent years (although up from the $0 bonuses during recession). We are coasting towards retirement and just have our fingers crossed for (a) company staying solvent (b) company keeping US presence and (c) not getting laid off. I am pretty ignorant about corporate taxes and have no idea how the change impacts a foreign company who has business in the US. Hopefully not negativity.

User avatar
House Blend
Posts: 4516
Joined: Fri May 04, 2007 1:02 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by House Blend » Mon Jan 01, 2018 11:45 am

Mom got a 2017 bonus due to retroactive lowering of the floor on Sched A medical deductions from 10% AGI to 7.5%. My back of the envelope calculation is that it saved her about $400 in Federal taxes.

User avatar
ClevrChico
Posts: 1311
Joined: Tue Apr 03, 2012 8:24 pm

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by ClevrChico » Mon Jan 01, 2018 11:49 am

I'd expect any increase to be for 2018 and paid out in 2019. I'll need to wait before we celebrate with a fancy dinner. One actionable thing you can do is track total compensation year to year in a spreadsheet. If can be quite interesting if you have variable compensation and several years of data.

User avatar
LadyGeek
Site Admin
Posts: 49271
Joined: Sat Dec 20, 2008 5:34 pm
Location: Philadelphia
Contact:

Re: Did you get an Unexpected Year End Bonus because of the Tax Cut?

Post by LadyGeek » Mon Jan 01, 2018 11:50 am

This thread has run its course and is locked (conjecture on the government / social impacts of tax policy). See: Non-actionable (Trolling) Topics
If readers can't do anything with the content of a topic other than argue about it, it does not belong here. Examples include:
  • US or world economic, political, tax, health care and climate policies
  • conspiracy theories of any type
  • discussions of the crimes, shortcomings or stupidity of other people, whether they be political figures, celebrities, CEOs, Fed chairmen, subprime mortgage borrowers, lottery winners, federal "bailout" recipients, poor people, rich people, etc. Of course, you are welcome to talk about the stupid financial things you have done.
This thread is locked based on past experience that the discussion will soon devolve into contentious disagreement. A few posts are already trending in that direction.
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.

Locked