Bar stipend tax question
Posted: Thu Feb 12, 2015 4:10 pm
Calling all tax gurus:
Current 3L, joining firm as first-year associate come fall. Just received bar stipend memo and tax options from firm. We can choose the "fully exempt from federal or state taxes" option or the "fully taxed" option [at bonus rate: 25% fed; ~6-10% for state]. What factors should I consider and which option is better for me in the long run?
Possibly relevant details: I'm unmarried, no dependents. I'm not working in the 2015 taxable year until I start at DC firm ($160k) in October. Bar study stipend is in the range of $15-17k. Don't really need the full amount upfront, but wouldn't mind.
Thank you in advance, tax genies!
Current 3L, joining firm as first-year associate come fall. Just received bar stipend memo and tax options from firm. We can choose the "fully exempt from federal or state taxes" option or the "fully taxed" option [at bonus rate: 25% fed; ~6-10% for state]. What factors should I consider and which option is better for me in the long run?
Possibly relevant details: I'm unmarried, no dependents. I'm not working in the 2015 taxable year until I start at DC firm ($160k) in October. Bar study stipend is in the range of $15-17k. Don't really need the full amount upfront, but wouldn't mind.
Thank you in advance, tax genies!