Chrysler factory workers to receive $1,750 bonus checks

[Bozita]

Source: Detroit News

November 30, 2012 at 11:20 am
Chrysler factory workers to receive $1,750 bonus checks
By Bryce G. Hoffman
The Detroit News


Chrysler Group LLC's 26,000 U.S. factory workers will be receiving $1,750 bonus checks on Dec. 21 — the second half of their bonus for signing the contract between the company and the United Auto Workers in 2011.

While workers at General Motors Co. and Ford Motor Co. received their full signing bonuses up front, Chrysler workers only received half of their $3,500 last year. The rest was payable when the company, which went bankrupt in 2009, achieved "sustained profitability" for four consecutive quarters.

The $381 million third-quarter profit that Chrysler reported in October represented the third straight quarter of profits for the company. Fourth quarter results are not due out until January. But Chrysler said Friday it is waiving the requirement and paying the bonuses now.

"This waiver of the four-quarter requirement is made in recognition of the tremendous contribution you have all made to the performance of our facilities and to the revival of Chrysler," CEO Sergio Marchionne said in a message to workers Friday morning. "You have also demonstrated a great level of commitment and cooperation in building a solid future for our company."



Read more: http://www.detroitnews.com/article/20121130/AUTO0101/211300425#ixzz2DjP88cFB

[closeupready]

1. Wow, nice.

K&R

[rhett o rick]

11. Wow Yeah. That's about 85 cents an hour. nm

[closeupready]

14. If take-home is $1,200, that's a flat-screen TV and a nice bike.

Which, in turn, feeds appliance retailers and workers.

[msongs]

2. are bonuses still taxed at the 50% rate (You only get half)? nt

[closeupready]

3. I believe it's taxed on an annual income rate - that is,

say that Chrysler workers are paid 26 times per year. Multiply that $1,750 by 26, and you get $45,500. The income withholding tax rate that applies would be that which would apply to a paycheck for someone earning an annual salary of $45,500. Someone who is an accountant can confirm whether or not that's correct, but I believe this is how withholding is calculated.

[LiberalFighter]

5. 35% is the highest tax rate

There is a $73.08 withholding allowance per exemption that is deducted from the wages before taxes are determined. A single worker would have a maximum of $1676.92 of taxable income putting them at the 25% tax bracket.

Their maximum tax would be:
(Zero $00.00 tax on amount below $41
(10%) $ 16.80 tax on amount over $41 - and below $209
(15%) $ 76.80 tax on amount over $209 - and below $721
(25%) $238.98 tax on amount over $721 - and below $1,688
Total tax -- $332.58 (If math is right)

A married worker would have a maximum of $1603.84 of taxable income putting them at the 25% tax bracket.

Their maximum tax would be:
(Zero $00.00 tax on amount below $156
(10%) $ 33.40 tax on amount over $156 - and below $490
(15%) $ 153.75 tax on amount over $490 - and below $1515
(25%) $ 22.21 tax on amount over $1515 - and below $2900
Total tax -- $209.36 (If math is right)


SOURCE USED: IRS 2012 Publication 15

[Indykatie]

7. Companies Typically Tax Bonus and Other Special Payments at 28% And Not the Table Shown in Your Post

A signing bonus would fall into this category of payments. The company I worked for used the 28% tax rate for our Union signing bonuses but gave members an opportunity to direct some or all of the payment to a tax free account such as their 401K or their HSA.

[Randomthought]

9. bonus taxed at gift tax rate

at the time they are distributed but are reported as income on W-2 so any excess is refunded when taxes are filed. At least that's how bonus checks work at the company where I work

[LiberalFighter]

13. If it is supplemental wage as defined by Pub 15

It is taxed at 25% or it can be paid normally if combined either with current week wages or prior payroll period.

[LiberalFighter]

6. 2 things to clear up...

1) There is no 50% tax rate.
2) There is not a flat tax rate on income unless the person doesn't have enough income to tax.

[sarcasmo]

4. Right on. Any statement form Romney on the bonus?

[ProfessorGAC]

8. Translation: The Fourth Quarter In A Row Of Profitability Is In The Bag

I don't mean that to be as cynical as it sounds. The company is doing the right thing, but i doubt they are really waiving the requirement. Just paying the bonus at Christmas time because they know Q4 is going to be profitable.

Still pretty cool.
GAC

[JNelson6563]

10. Great news!

[Iggy]

12. BEENGO!!!

want workers to CARE? to be more motivated?

then yes, profit sharing via BONUSES is a very smart thing.

It started when Henry Ford was smart enough to know to pay his workers MORE... so they could at least afford to purchase the cars they were making.

it's not rocket science, folks.