Skip to main content
K
koloni
January 10, 2023
Question

Employee Taxes

  • January 10, 2023
  • 1 reply
  • 0 views

Hi,

 

I have an employee we are paying out common stock as part of a separation agreement. I need to withhold taxes on the FMV of the stock. Any resources or articles on how to correctly calculate the amount of tax to withhold and how to then withhold the amount of remaining paychecks?

 

Thanks!

1 reply

BigRedConsulting
BigRedConsulting
January 13, 2023

To do this you'll need to increase the taxable compensation, tax it, and then back out that compensation amount. This is typically done with two items, a compensation addition and a net deduction with no tax tracking type, which has no impact on taxes. This works much like reported tips.

Terms & ConditionsAccessibility statement