[USER]

Need advice on paying back bonus. I was hired at my last job with a front up $25K bonus. Contract indicated I need to pay it back if I leave before 3 years or if I am fired.

The work ended up being very toxic and the owner fired me after just 3 months.

The total bonus I got after tax was $14K
Do I pay back $25K or $14k?

Thank you in advance

[Nicole]

You’d owe them the full $25k.
An accountant can help with tax filing to get the taxes you paid back.

I believe you’d be looking for a section 1341 credit to get the taxed funds back

[Cyndi]

You will pay it back in entirety. If this all happened within the same calendar year then it will be a moot point from a tax perspective; you will claim the repayment on your tax return so you will get that huge overpayment back.

[Aatiyah]

HR Here. Let them tell you what dollar amount you owe back. At the companies I’ve worked for, we’ve asked for a check for the netted amount.

It’s unfortunate though that they have the clawback if it’s an involuntary termination.

I’ve not seen that before. Also for future, always hold on to the signing bonus until you know it’s a job you want to be at.

[Lisa]

I would have an employment attorney who’s familiar with the laws in your vicinity review the contract.

[Vanessa]

You pay back what they paid you of the bonus. You wouldn’t pay them more than that.

[Damon]

Read the contract. The answer should be there. That’s the starting point.

I have never heard of anyone who had to pay back money they didn’t yet receive.

[Donna]

Just a sidenote that it surprises me that the employer paid the bonus upfront. Typically sign on bonuses are not paid out until at least a 3 mo or 6 mo anniversary.

I wonder if they paid it so early knowing it was a bad place to work, but to try to keep you there. (Yes I am aware ultimately they let you go)

[Virge]

I would get a lawyer to read the contract esp if ground is firing & not you voluntarily leaving. Wordings matter here. Good luck

[Rachel]

I had this happen.
I paid back the amount that I got after tax. The company had to do the rest on their end to get back the amount that was paid to taxes.

[Michael]

I had a similar situation about 5 years ago. I did not have to pay back the bonus if I didn’t leave on my own.

They asked and I met with an attorney about it. $300 for the attorney session and a letter.

I kept the bonus

[Author]

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