BONUS TAX CALCULATOR
On a $10,000 bonus, federal withholding alone takes about $2,200 using the standard 22% flat method, plus FICA, leaving roughly $7,035 before any state tax.
That 22% is a withholding rate, not a special “bonus tax” rate, your actual tax bill gets reconciled when you file.
Few paycheck moments cause more confusion than opening a bonus check and finding a much smaller number than expected. The reason almost never has anything to do with a special higher tax rate, there isn’t one. The IRS classifies bonuses as “supplemental wages” and, for administrative simplicity, lets employers withhold federal tax on them using a flat 22% rate instead of running the payment through your regular W-4 calculation. IRS Publication 15-B confirms this rate is unchanged for 2026, and it applies to the first $1 million of supplemental wages paid to one employee in a calendar year; anything above that gets a mandatory 37% withheld. The One Big Beautiful Bill Act, which made most of the 2017 tax reform’s brackets permanent, didn’t touch this supplemental rate at all.
Here’s the part that actually matters for your wallet: 22% withholding is frequently more than what you’d owe based on your actual marginal tax bracket, especially if your regular salary keeps you in the 12% or 22% bracket. When that happens, the excess comes back to you as part of your refund when you file. If your bonus pushes you into a higher bracket than usual, the opposite can happen, you might owe more at filing time. Either way, the number on your bonus check reflects withholding, not your final tax bill.
Calculate Your Bonus Withholding
Uses the flat percentage method (22% federal, 37% above $1M/year), the most common way employers withhold a bonus paid as a separate check. This is a withholding estimate, not your final tax liability, which is settled when you file.
The Percentage Method: A Worked Example
| Step | Detail | Amount |
|---|---|---|
| Gross bonus | Starting point | $10,000 |
| Federal withholding | Flat 22% (assuming under $1M for the year) | -$2,200 |
| Social Security | 6.2% (assuming room under the wage base) | -$620 |
| Medicare | 1.45% | -$145 |
| What you keep (before state tax) | $7,035 |
That’s a combined 29.65% taken out up front on this example, even though the person’s actual marginal federal bracket might only be 12% or 22%. If their real bracket is lower than 22%, the difference between what was withheld and what they actually owe on that income comes back as part of their refund.
Percentage Method vs Aggregate Method
Employers can legally choose either method when paying a bonus, and which one they pick meaningfully changes how much lands in your account that specific payday.
| Method | How It Works | Typical Result |
|---|---|---|
| Percentage (flat) method | Bonus paid as a separate check; federal tax withheld at a flat 22% regardless of your W-4 | Predictable; most common for one-time or annual bonuses |
| Aggregate method | Bonus added to your most recent regular paycheck; the combined total is taxed as if it were your normal pay for that period | Often withholds more than 22%, since the combined amount can look like a much higher-paying pay period |
If your bonus feels like it was taxed unusually hard, the aggregate method is frequently the reason, a $5,000 bonus added onto a regular paycheck can temporarily push that one paycheck’s apparent annualized income high enough that withholding tables pull a much bigger percentage than 22%. Either way, the extra withholding isn’t lost, it’s credited toward your total tax liability when you file.
Bonuses and FICA: Social Security and Medicare
Bonuses aren’t exempt from payroll taxes just because they’re supplemental. The same Social Security and Medicare rules that apply to your regular paycheck apply here.
| Tax | Rate | How It Applies to a Bonus |
|---|---|---|
| Social Security | 6.2% | Applies only if your year-to-date wages (including the bonus) stay under the $184,500 wage base for 2026; no additional Social Security tax once you cross it |
| Medicare | 1.45% | Applies to the full bonus amount with no cap |
| Additional Medicare | 0.9% extra | Applies to the portion of combined wages above $200,000 single / $250,000 married filing jointly |
This is why a large year-end bonus for a high earner who’s already crossed the Social Security wage base can actually keep a bigger percentage than the same bonus paid earlier in the year, once that $184,500 threshold is behind them, the 6.2% Social Security bite disappears entirely for the rest of the year.
State Tax on Bonuses
Most states with an income tax apply their own withholding to a bonus, and several publish a specific supplemental wage rate that’s different from regular paycheck withholding.
| State | Supplemental Bonus Withholding Rate |
|---|---|
| California | 10.23% |
| New York | 11.7% |
| Flat-tax states (Arizona, Colorado, Illinois, Indiana, Michigan, North Carolina, Pennsylvania, Utah, and others) | Generally the state’s normal flat rate |
| No-income-tax states (Texas, Florida, Tennessee, Washington, and others) | 0%, no state withholding at all |
If your state isn’t a true flat-tax state and doesn’t publish a specific supplemental rate, employers commonly default to that state’s top marginal bracket or treat the bonus like regular income using your state W-4 elections. Check your specific state’s Department of Revenue for the exact figure, or use one of the state paycheck calculators below to see how bonus income interacts with your state’s regular bracket structure.
Frequently Asked Questions
Are bonuses taxed at a higher rate than regular pay?
No. There is no special higher tax rate for bonuses. The IRS treats bonuses as ordinary income, taxed at your normal marginal tax brackets when you file your return. What feels like a higher rate is actually withholding: employers commonly withhold a flat 22% for federal tax on bonuses under $1 million, which can be more than your actual tax bracket, especially for moderate earners. Any amount over-withheld comes back as part of your refund.
What is the federal withholding rate on bonuses in 2026?
For 2026, the IRS lets employers withhold federal income tax on bonuses and other supplemental wages at a flat 22% for amounts up to $1 million in a calendar year. Any amount above $1 million paid to one employee in the same year must be withheld at a mandatory 37%, confirmed unchanged in IRS Publication 15-B.
What is the difference between the percentage method and the aggregate method?
The percentage method withholds a flat 22% federal rate when a bonus is paid as a separate check from your regular wages. The aggregate method adds the bonus to your most recent regular paycheck and withholds tax on the combined total using your W-4 elections, which often results in more being withheld than the flat 22% method, especially for a large bonus.
Do Social Security and Medicare apply to bonuses?
Yes. Bonuses are subject to the same FICA taxes as regular wages: 6.2% Social Security up to the 2026 wage base of $184,500 (no additional Social Security tax applies once your year-to-date wages cross that amount), and 1.45% Medicare with no cap, plus an extra 0.9% Medicare surtax on combined wages above $200,000 single or $250,000 married filing jointly.
Does state tax apply to bonuses too?
In most states with an income tax, yes. Many states publish their own separate supplemental wage withholding rate, for example California withholds bonuses at 10.23% and New York at 11.7%, both higher than their regular withholding tables. Flat-tax states generally just apply their normal flat rate to bonuses. States with no income tax, like Texas or Florida, withhold no state tax on a bonus at all.
The gap between what your bonus check shows and what you expected almost always comes down to withholding mechanics, not a punitive “bonus tax.” A flat 22% federal rate, FICA, and whatever your state charges combine to take a noticeable chunk up front, but none of it is lost, it all counts toward your actual tax bill when you file. If your real marginal bracket runs below 22%, that gap becomes part of your refund. For the full picture of how a bonus interacts with your regular salary and state tax bracket, check one of the state paycheck calculators below.
California New York Texas Florida Ohio Michigan Federal Tax Calculator Overtime Calculator Hourly to Salary Calculator All State Calculators
Figures on this page are estimates for tax year 2026 based on IRS Publication 15-B and Revenue Procedure 2025-32 as of August 2026. Withholding shown here reflects the common flat percentage method; your employer may use the aggregate method instead, which can produce a different result. This is a withholding estimate, not your final tax liability. Verify current figures with the IRS, your state’s Department of Revenue, or a tax professional before filing.