Bonus Tax Calculator
Bonuses are withheld at a flat 22% federal rate, not your tax rate. See what you take home today, and whether that withholding leaves you a refund or a bill.
Withholding uses the flat-rate (percentage) method. The true cost annualizes your salary plus the bonus at 2026 rates — your own return settles the difference.
Why your bonus looked so much smaller
A bonus paid on its own check is a supplemental wage payment, and payroll is allowed to skip your W-4 entirely and withhold at a flat rate instead. For 2026 that rate is 22% federal — plus FICA and any state withholding on top. Nothing about that is a “bonus tax”: bonuses are ordinary income taxed at your ordinary rates. The 22% is a withholding shortcut, and it is almost never exactly right.
Worked example
Single filer, $65,000 salary in Texas, $5,000 bonus. Payroll withholds $1,100 federal (22%) and $382.50 FICA, so $3,517.50 lands in the account. But the bonus only pushed $3,500 into the 22% bracket and left $1,500 in the 12% one — its true federal cost is $950, or $1,332.50 once FICA is added. The extra $150 comes back at filing. Move that same bonus onto a $250,000 salary and it flips: 22% withholding covers barely two-thirds of a bonus taxed at 32–35%, leaving roughly $5,800 owed.
Aggregate method vs. flat rate
Employers choose between two methods, and which one they pick changes your check:
| Percentage (flat-rate) method | Aggregate method | |
|---|---|---|
| When it's used | Bonus paid on a separate check | Bonus lumped into a regular paycheck |
| How it's withheld | Flat 22% federal, W-4 ignored | Bonus + regular pay run through the W-4 tables as one payment |
| Typical result | Over-withholds for most middle earners; under-withholds high earners | Often withholds more, because a single large check looks like a huge annual salary to the tables |
This calculator models the flat-rate method, which is what most employers use for a standalone bonus check. Either way the final tax is identical — only the timing of the money changes.
The $1 million rule
Once supplemental wages paid to you cross $1,000,000 in a calendar year, the excess must be withheld at 37% — the top individual rate — and the employer has no choice about it. The threshold is cumulative across the year, which is why the calculator asks about earlier bonuses: a $600,000 bonus following a $700,000 one is not treated the same as the first $600,000.
State withholding on bonuses
- Flat supplemental rates: California withholds 10.23% on bonuses and stock options (6.6% on other supplemental wages); New York State uses 11.70%. Both are far above what most filers in those states actually owe, so bonuses there tend to over-withhold hard at the state level.
- Flat-tax states like Pennsylvania have nothing special to apply — the ordinary 3.07% covers all compensation, so state withholding on a bonus is simply right.
- No-income-tax states still take something. Washington charges WA Cares and PFML premiums on bonus wages; Texas, Florida, Nevada and Tennessee take nothing at all.
- Post-tax premiums (CA SDI, NY PFL, WA Cares/PFML) apply to bonus wages just like salary — including their annual caps, so a bonus can be free of them if your salary already maxed the cap.
Things worth knowing before the bonus lands
- Deferring into a 401(k) works. Many payroll systems let you set a separate bonus deferral percentage. Contributions dodge federal and state income tax (not FICA) and are the cleanest way to keep a bonus out of a high bracket.
- Social Security stops at the wage base. If salary plus bonus crosses $184,500, the 6.2% share stops on the amount above it — one of the few ways a big bonus is taxed less than expected.
- Additional Medicare starts at $200,000 ($250,000 married filing jointly): another 0.9% on wages above the line, withheld automatically.
- Withholding is not the tax. Everything on your W-2 — salary, bonus, commission — is added up and taxed once on the return. A bonus can't be “taxed at 40%” on its own; it can only be withheld that way.
Frequently asked questions
Why was my bonus taxed at 22%?
It wasn’t taxed at 22% — it was withheld at 22%. IRS rules let employers use a flat 22% supplemental rate on a bonus paid separately from regular wages instead of your W-4. The bonus is then taxed at your ordinary rates on your return, and the difference shows up as a refund or a balance due.
Is a bonus taxed higher than regular pay?
No. Bonuses are ordinary wages — same brackets, same FICA. The confusion comes from the flat 22% withholding rate, which is higher than the effective rate most people actually pay, so the paycheck looks disproportionately shrunk.
How much of a $5,000 bonus do I keep?
In a no-income-tax state, about $3,517 lands in your account: $1,100 federal withholding plus $382.50 FICA. In California the same bonus nets roughly $2,900 after 10.23% state withholding and SDI. What you ultimately keep depends on your bracket — for a $65,000 earner, roughly $150 of that federal withholding comes back at filing.
When does the 37% bonus withholding rate apply?
Only on supplemental wages above $1,000,000 in a single calendar year, counted cumulatively across all bonuses. Below that threshold the employer may use the optional 22% flat rate; above it, 37% is mandatory.
Can I avoid tax on my bonus?
You can’t avoid the tax, but you can move it: deferring the bonus into a traditional 401(k) or HSA removes it from taxable income for the year (FICA still applies to the 401(k) portion). Timing a bonus into a lower-income year works too, though employers rarely offer the choice.
Why did my employer withhold more than 22%?
Most likely they used the aggregate method — the bonus was combined with a regular paycheck and run through the W-4 tables, which read that inflated check as if you earned it every period. It over-withholds and self-corrects at filing.
Official sources
Every rate and threshold on this page comes from the issuing agency. Verify anything here against the primary source:
- IRS Publication 15 (2026), section 7 — Supplemental Wages — optional flat 22% withholding on supplemental wages; mandatory 37% on the part above $1,000,000 in a calendar year
- IRS — 2026 inflation adjustments — 2026 brackets and the $16,100 single / $32,200 joint standard deduction used for the true-tax figure
- SSA — Social Security wage base — 2026 taxable maximum of $184,500 — a bonus above it stops paying the 6.2% Social Security share
- California EDD — DE 231PS, Supplemental Wage Payments — California flat rate of 10.23% on bonuses and stock options (6.6% on other supplemental wages)
- NYS Publication NYS-50-T-NYS (1/26) — New York State supplemental rate of 11.70% for 2026
Last reviewed: 2026-08-29 · Report an issue