Did you get a sign-on bonus in 2021? You may be eligible for a big tax refund

Before Bailey Schaub interviewed for a surgical technologist opening at a hospital in Kansas City, Missouri, a recruiter called to tell her about a $10,000 signing bonus she would receive if she got the job.

After graduating college in May, Schaub, 23, had moved into a new apartment in the city, living by herself with hardly any furniture. The prospect of another $10,000 could not have come at a better time.

She took the job, but when she got her first paycheck for $1,000 she earned in wages from her first two weeks as well as the bonus – she did a double-take.

More than $2,000 in federal taxes were deducted from the bonus, she told USA TODAY after reviewing her first paycheck.

“I was planning on using that check to make sure I had furniture and get everything I needed to set up my apartment,” she said. "Seeing how much was taken out of (the bonus) was definitely disappointing."

At the time, Schaub had been sleeping on the floor on her mattress because she couldn't afford a bed frame."I had to wait for more paychecks to continue to get all the furniture and things I needed in the apartment.”

Tight labor market pushes employers to offer more hiring bonuses

Like Schaub, many other Americans have been offered signing bonuses. In 2021, nearly 13% of jobs posted on ZipRecruiter offered them, compared with 2% of jobs in 2019, according to data the site provided USA TODAY.

And across all private-sector jobs, more than 2% of employers offered signing bonuses for new hires from July through September, according to Bureau of Labor Statistics data published in February. Collectively, they employ more than 11 million Americans.

It’s a sign of the times as employers in the U.S. face one of the most competitive labor markets in decades.

“Employers who previously only offered signing bonuses to poach talent during bidding wars are now providing them to entire classes of workers – including, in some cases, to all groundskeepers or all kitchen staff,” said Julia Pollak, chief economist at ZipRecruiter. “It's a sea change from the way signing bonuses were used before.”

Source: https://markets.businessinsider.com/news/stocks/did-you-get-a-sign-on-bonus-in-2021-you-may-be-eligible-for-a-big-tax-refund-11106486

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