Bonus Tax Calculator

Bonus Tax Calculator (2026)

Why was your bonus taxed at 22%, 40%, or more? Employers withhold federal supplemental tax (22% under the flat method), full FICA (7.65%), and your state supplemental rate in one check. That feels like a permanent bonus tax rate, but it is only withholding. You reconcile the real tax when you file. Use the calculator to model flat vs aggregate withholding for your state, or read our how bonuses are taxed in 2026 guide for the full breakdown.

Written by Elena Marquez

Tax Research Lead

Reviewed by Jordan Avery

Lead Editor

Last updated June 17, 2026

Fact-checked: IRS Publication 15-T and 2026 SSA wage-base data

How we calculated these examples →

Bonus tax estimator

Flat supplemental (22%) or aggregate W-4 withholding

Bonus amount

Withholding method

State

Defer to traditional 401(k) / HSA (% of bonus)

Reduces income-tax withholding only; FICA still applies.

How Bonuses Are Taxed in 2026

At tax filing time, bonuses are ordinary income. There is no separate permanent bonus tax rate on Form 1040. Salary, commissions, RSUs, and signing bonuses all land in W-2 Box 1 and are taxed at your marginal bracket after the standard deduction and credits. The shock most people feel is withholding: how much your employer takes out of the bonus check before you see it.

The IRS classifies bonuses as supplemental wages (IRS Publication 15, Section 7). Employers must withhold federal income tax using one of two approved methods:

Flat / percentage method: 22% federal supplemental withholding on amounts up to $1,000,000 in a calendar year (37% above that), plus full FICA and your state supplemental rate. Default when the bonus is paid on a separate check.
Aggregate method: The bonus is added to a regular paycheck and run through your W-4 withholding tables. Common when payroll combines bonus and regular wages in one pay period.

Either way, you reconcile when you file. Too much withheld becomes a refund; too little becomes a balance due. For how FICA (Social Security and Medicare) applies to bonuses, or how to calculate your take-home pay on regular wages, see our guides.

Flat vs Aggregate Method - Which Will My Employer Use?

Method	How it works	When used	Typical result
Flat / percentage	22% federal supplemental on the bonus up to $1M, 37% above. Plus full FICA (7.65%) and your state supplemental rate.	Default for most employers and payroll systems. Used when the bonus is paid separately from a regular paycheck.	Predictable ~30%-45% withheld depending on state. Often higher than your marginal rate, often over-withholds.
Aggregate	Bonus is added to a regular paycheck and run through your W-4 tables as if it were a single combined check.	Often used when the bonus is paid in the same check as regular wages, or for commissions tied to a pay period.	Can withhold more (or less) than flat method depending on your W-4 settings, dependents, and existing pay.

If your bonus arrives on its own check, expect the flat 22% supplemental method. If it is combined with regular pay, aggregate is more likely. You cannot usually pick the method for a one-time bonus. Model both in the calculator above, or compare with our salary paycheck calculator for your regular wages.

Bonus Tax by Amount

Single filer, California, 2026. Flat supplemental method: federal 22%, FICA 6.2% + 1.45%, California bonus supplemental 10.23%. Assumes year-to-date wages below the $184,500 Social Security cap.

Bonus	Federal 22%	Social Security	Medicare	CA 10.23%	Net	Effective %
$1,000	$220	$62	$14.50	$102	$601	39.88%
$2,500	$550	$155	$36.25	$256	$1,503	39.88%
$5,000	$1,100	$310	$72.50	$512	$3,006	39.88%
$10,000	$2,200	$620	$145.00	$1,023	$6,012	39.88%
$25,000	$5,500	$1,550	$362.50	$2,558	$15,030	39.88%

See the California paycheck calculator for regular salary withholding. Methodology.

Why Your Bonus Looks Over-Taxed (and how to get some back)

A $5,000 bonus in California might show $1,100 federal withholding (22%), $382.50 FICA, and $511.50 state supplemental - about $1,994 gone immediately (~40%). In New York the state layer is even higher (11.70% supplemental). Combined withholding can reach 35%-45% in high-tax states even when your true marginal rate is lower.

That is withholding, not your final tax. If your total annual income does not put you in a higher bracket, you may recover part of the excess when you file Form 1040. If bonuses are routine, update your W-4 for 2026 (Step 4(b) extra deductions or Step 4(c) extra withholding) so regular paychecks better match your expected annual tax. See also why your paycheck went down for other withholding surprises.

Bonus Over $1 Million

Federal supplemental withholding steps up once cumulative supplemental wages in a calendar year exceed $1,000,000. The portion above $1M is withheld at 37%, not 22%. FICA and state supplemental still apply on top.

Cumulative supplemental in year	Federal supplemental rate
Up to $1,000,000 (cumulative supplemental in year)	22% federal supplemental
Above $1,000,000 (cumulative supplemental in year)	37% federal supplemental

Reduce the Tax on Your Bonus

You cannot eliminate income tax on a bonus, but you can lower withholding and sometimes your final tax:

Defer to traditional 401(k) or HSA: If your employer allows bonus deferrals, the deferred amount is excluded from federal and state income-tax withholding. FICA still applies to 401(k) deferrals. Model the % in the calculator above.
Timing: A bonus paid in January resets FICA withholding for the year but may spread income across tax years if your employer offers a choice (uncommon).
Charitable giving: Pre-tax payroll donations through your employer reduce taxable wages on that check.

For whether to defer pre-tax or use Roth, see our Roth vs Traditional 401(k) guide.

State-by-State Bonus Withholding

Federal supplemental withholding is the same nationwide (22% / 37%). State supplemental rates vary. California uses 10.23% on bonuses and stock (Method B). New York uses 11.70%. No-income-tax states (Texas, Florida, Washington, Nevada, and others) add 0% state withholding. States without a published bonus rate may use the top marginal bracket; we flag those as approximate in the calculator.

State	Supplemental rate	Notes
California	10.23%	Bonus / stock supplemental rate
New York	11.70%	Bonus supplemental rate (NYC adds ~3.876%)
Illinois	4.95%	Matches state flat 4.95%
Pennsylvania	3.07%	Matches state flat 3.07%
Massachusetts	5.00%	5% on most wages; 9% above $1M
Michigan	4.25%	Matches state flat 4.25%
North Carolina	4.50%	Matches state flat 4.50%
Indiana	3.05%	Matches state flat 3.05%
Texas	0%	No state income tax
Florida	0%	No state income tax
Washington	0%	No state income tax
Nevada	0%	No state income tax
New Jersey (approx.)	10.75%	Top marginal supplemental (verify with NJ DOR)
Colorado (approx.)	4.40%	Top marginal supplemental (verify with CO DOR)
Virginia (approx.)	5.75%	Top marginal supplemental (verify with VA DOR)
Ohio (approx.)	3.50%	Top marginal supplemental (verify with OH DOR)
Oregon (approx.)	9.90%	Top marginal supplemental (verify with OR DOR)

Compare regular salary withholding with our New York, Texas, and all 50 state calculators.

Bonus vs Salary - Are They Taxed Differently?

At filing: No. Bonuses and salary are both ordinary income on your tax return, taxed at the same marginal rates after deductions and credits.

At withholding: Yes, the mechanics differ. Regular paychecks use your W-4 and annualized withholding tables. Bonuses often use the flat 22% federal supplemental method plus state supplemental rates, which can over- or under-withhold relative to your true bracket. Use our hourly paycheck calculator or overtime pay calculator for non-bonus wages.

Frequently asked questions

Why was my bonus taxed at 40%?

Bonuses often look heavily taxed because employers withhold federal supplemental tax (22% under the flat method, or 37% above $1M), full FICA (7.65%), and your state supplemental rate in one check. In high-tax states like California (10.23% supplemental) or New York (11.70% supplemental), combined withholding can reach 40%-45%. That is not your final tax. You reconcile the real amount when you file. If too much was withheld, you get a refund. If too little, you owe the difference.

What is the 2026 bonus tax rate?

There is no separate bonus tax rate at filing time. Bonuses are ordinary income, taxed at your marginal bracket. What most people feel is withholding: federal supplemental is 22% on amounts up to $1,000,000 in a calendar year (37% above that). Social Security is 6.2% up to the $184,500 wage base. Medicare is 1.45%, plus 0.9% Additional Medicare on amounts above $200k single or $250k joint. State supplemental rates apply on top. California is 10.23%. New York is 11.70%. No-income-tax states add 0%.

Are bonuses taxed differently than salary?

At filing time, no. Bonuses, salary, commissions, RSUs, and overtime premiums are all ordinary income. The difference is withholding. Most employers use the IRS flat method: 22% federal supplemental plus FICA and state tax. The aggregate method adds the bonus to a regular paycheck and runs it through W-4 tables. That can withhold more when the bonus is large.

How do I avoid tax on my bonus?

You cannot avoid income tax on a bonus, but you can reduce withholding and the final tax. Defer part of the bonus into a traditional 401(k) or HSA if your employer allows it on bonus payouts. The deferred amount is excluded from federal and state income-tax withholding. FICA still applies to 401(k) deferrals. You can also adjust W-4 Step 4(b) to add an extra annual deduction equal to the expected bonus. Or donate through employer payroll if your plan supports it. None of these eliminates the income, but they reduce the immediate hit.

Is the bonus tax refundable?

Yes. Withholding is a prepayment, not your final tax. If your employer withheld more than your actual liability, the excess shows up as a federal refund when you file Form 1040. You may also get a state refund if your state has income tax. The most common reason for a bonus refund is that your year-end income did not push you into the bracket the supplemental withholding assumed.

Sources and methodology

By Elena Marquez. Updated for 2026. See our methodology for formulas and assumptions. This is educational information, not tax or legal advice.

IRS Publication 15 (Circular E) - Supplemental Wages https://www.irs.gov/publications/p15
IRS Publication 15-T (2026) - Employer Tax Guide https://www.irs.gov/pub/irs-pdf/p15t.pdf
IRS Topic 751 - Social Security and Medicare Withholding https://www.irs.gov/taxtopics/tc751
California Franchise Tax Board - 2026 PIT Withholding (Method B) https://www.ftb.ca.gov/payroll/withholding.html
New York Department of Taxation and Finance - Bonus Withholding https://www.tax.ny.gov/pit/business/wtidx/bonus.htm
Social Security Administration - 2026 Wage Base ($184,500) https://www.ssa.gov/oact/cola/cbb.html

Disclaimer | Estimates only. Consult a tax professional for your situation.