How come they tax my bonuses when i receive them and then again at the end of the year?

[VolvoGirl]

How do they tax them at the end of the year?  You mean in your tax return?  The bonuses are part of your total income.  Having more income puts you into a higher tax bracket.  And the tax withholding deducted might not be enough to cover the extra tax so you owe more.p

[rjs]

"They" don't tax your bonus twice. A bonus is treated the same as wages. It's additional pay. When you file your tax return at the end of the year, all your income is added up and the tax for the year is calculated on your total income, including your regular pay, bonus, and any other income. That amount that's calculated on your tax return is the tax that you actually pay on your income.

When you receive the income during the year, tax is withheld from each payment you receive. That's done for your regular pay and for your bonus. But the tax that's withheld is just an advance payment towards the tax that's calculated on your tax return. The withholding is not your final tax. The total tax withheld during the year is applied to the total tax calculated on your tax return. If the tax that was withheld is more than your actual tax, you get a refund of the overpayment. If the tax withheld is less than your actual total tax, you have to pay the difference.