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Payroll records for Future Tech show that on Sept. 8, 1995, Haycox and six other employees received $1,000 bonuses. Five days later, the employees each gave the Clinton/Gore campaign a $1,000 donation, Federal Election Commission records show.
Hmmm. The IRS will be interested to know if Federal Income tax, Social Security tax, and Medicare tax was properly withheld from those bonuses. Under Internal Revenue Code, *all* cash payments are gross wages, and the previously mentioned taxes must be withheld from every check or cash that an employee gets. If it was done properly, then the gross bonus would have had to been closer to $1,300, and the employer would have had to match the Social Security and Medicare withheld, in the form of Employer Payroll Tax.
So there is no way possible for that "Future Tech" company to have made the deal with the employees without it costing the company at least 7.65% of Gross Wages, unless the employees wages already were higher than the ceiling of taxable wages for Social Security purposes. But since there is no ceiling on Medicare Employer Payroll tax, the transaction would have cost the company a minimum of 1.45% of Gross Wages paid with the bonuses, *plus* the amount of Federal Income tax withheld, at a minimum rate of 15%.
My guess is that the company may have not done the bonuses properly. I would think that the IRS might be suspicious also. |
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