Military Bonus and Social Security

[WhiteOleander]

I hope someone here does alot of military returns with wages. Most of our military clients are retired military.

We have had two guys in today that had W-2s from the military. They had been paid bonuses for various reasons.

On one of the W-2's box 1 was 20600.00
box 3 was 600.00
box 5 was 600.00

On the second W-2 for the other guy
box 1 was 45000.00
box 3 was 20000.00
box 5 was 20000.00

I can't figure out why they did not pay Social Security on the bonuses. All info I have found online indicates that bonuses are subject to Soc Sec.

Any thoughts would be appreciated.

(all amounts posted are ficticious)

Thanks

[whkrueg]

Military Bonus and Social Security

I have just got a W2 with the same thing. My client is in the Army Reserve and got a reenlistment bonus of $15,000. It shows up in box 1 of the W2. But, not in boxes 3 and 5 and I can not find the reason why no social security or medicare was withheld.

Since this is the 2nd posting about this kind of W2 it must be the rule. I was wonding if anyone knew the reason why.

Thanks
Wayne

[BOB W]

I have just got a W2 with the same thing. My client is in the Army Reserve and got a reenlistment bonus of $15,000. It shows up in box 1 of the W2. But, not in boxes 3 and 5 and I can not find the reason why no social security or medicare was withheld.

Since this is the 2nd posting about this kind of W2 it must be the rule. I was wonding if anyone knew the reason why.

Thanks
Wayne

I feel it is not my job to question this type of W2. I enter it as shown and move on.

[WhiteOleander]

I actually received an answer regarding my person. He received a bonus for getting someone else to enlist into the service. Since it is not his occupation to do enlistments, they said he doesn't pay SE tax. So, my issue was solved.

[gkaiseril]

Glad to here you have it resolved.

If you can look at the LES, Leave and Earning Statement, you might have seen the payment.

Military personnel can receive a fair number of allotments, special pays, and performance pays and the source and when paid can affect the taxability of the payment.