Sign-on bonus tax

[chetchamay]

Hello,

I was searching on the web about my situation, but with no prevail. Here is the story:

I got a sign-on bonus for the company for staying as full-time for 1 year. However, I switched to part-time several months later. The company said that they will give me $5K for the sign-on, however, when they gave it to me in 2007 I only received about $3K b/c it has been taxed. Then in 2008, I switched to part-time, thus the company said that I have to pay back the full $5K, which I did in 2008 just right after 1/31/2008 when the company already sent out the W-2 form for the employees. They said that they cannot do anything since the W-2 was already out.

Now, how can I get back the amount that was taxed? Through an itemized deduction in schedule A? Do I need proof of the sign-on bonus paperwork and such? Please guide me through and leave comments/suggestions.


Thanks in advance.

 

[Michael Wechsler]

I don't know what your agreement is. You can take a position with the government that the W-2 is wrong. But technically it would seem that the $5K was paid back in 2008 and thus would be subject to your filing this year and not a mistake.