How to use the bonus tax calculator
- 1 Enter the bonus amount.
- 2 Enter your wages so far this year, which matter for the Social Security cap and extra Medicare tax.
- 3 Enter your state's supplemental withholding rate, or 0 if there is no state income tax.
- 4 Read your net bonus and the gross-up figure.
Worked example
A $10,000 bonus with $60,000 earned so far and a 5% state rate. Federal withholding is $2,200, Social Security $620, Medicare $145 and state tax $500, so you take home $6,535, about 65%. To net exactly $10,000, the bonus would need to be about $15,302.
Why bonuses look over-taxed
Bonuses are supplemental wages. Most employers withhold a flat 22% federal tax on them, or 37% on the part above $1 million, instead of using your normal withholding. This is withholding, not your final tax: when you file, the bonus is taxed like the rest of your income.
- Refund or bill: if your top bracket is 12%, the 22% withholding is too high and you get the difference back. In the 32% bracket and above, you may owe more.
- Aggregate method: some employers add the bonus to a regular paycheck and withhold on the total, which can look even higher for that one check.
- Lower the tax: ask payroll to put part of the bonus into your 401(k), within the yearly limit.
Check your real yearly tax with the Federal Income Tax Calculator, and compare with a permanent raise using the Pay Raise Calculator.
Features
22% federal flat rate
The percentage method most employers use for bonuses up to $1 million.
FICA handled
Social Security stops at the $184,500 wage base; Medicare adds 0.9% above $200,000.
Gross-up
Shows the bonus needed to take home a set amount.
When to use it
Year-end bonuses
Know what you will really receive in December. See your real yearly tax with the Federal Income Tax Calculator.
Sign-on bonuses
Compare offers on an after-tax basis. Compare with a raise using the Pay Raise Calculator.
Employers
Gross up a bonus so an employee nets a round number. Plan where part of it goes with the 401(k) Calculator.
Commission checks
Estimate withholding on commission paid separately. Check your normal pay with the Paycheck Calculator.
Related Pay and Salary tasks
Frequently asked questions
Why are bonuses taxed at 22%?
They are not taxed more; they are withheld at a flat 22% federal rate. Your actual tax is worked out on your return with all your income, so you may get some back or owe more.
What if my bonus is over $1 million?
Supplemental wages above $1 million in a year must be withheld at 37%.
Is Social Security taken from a bonus?
Yes, 6.2%, until your wages for the year reach $184,500 in 2026.
What is the aggregate method?
Some employers add the bonus to a regular paycheck and withhold as if that pay continued all year, which can withhold more.
Which states tax bonuses at a special rate?
Many states have a flat supplemental rate, for example California 6.6% for most bonuses and New York 11.7%. States with no income tax withhold nothing.
Can I reduce tax on a bonus?
Putting part into a 401(k) or HSA through payroll lowers federal and most state income tax.
Will I get a refund?
If your marginal rate is below 22%, you may get part of the withholding back when you file.
Does a bonus count toward my 401(k)?
It depends on your plan. Many plans let your normal deferral percentage apply to bonuses, which lowers the tax withheld.
Why does my bonus check look smaller than my regular pay rate suggests?
The flat 22% may be higher than your normal withholding rate, and FICA and state tax still apply. Any extra withholding comes back as a refund if your overall tax is lower.
Can I ask my employer to withhold less?
Employers must use the supplemental rules. You can adjust your W-4 for regular pay to balance the year.
Results are estimates based on the official rates linked above. Confirm important figures with the issuing authority or a qualified adviser before you act on them.
Built and reviewed by Hamza Farooq, founder and lead developer
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