As usual, 'everyone' doesn't know how this really works. You may get Some of the taxes paid back, but probably not All unless the bonus was paid during combat zone service. Taxes are withheld based on current income rate, which is much higher when the bonus kicks in. At the end of the year, tax will be averaged out, and probably be less overall because you weren't paid at the higher bonus-included rate all year. However, unless the combat zone exception applies, there will be Some tax on that bonus pay ...