How bonuses are taxed in 2026
A bonus is “supplemental wages” in IRS terms. Your employer chooses how to withhold federal income tax on it:
- Flat (percentage) method: 22% of the bonus when it is paid separately from regular wages, and a mandatory 37% on supplemental wages above $1 million in a calendar year.
- Aggregate method: the bonus is added to a regular paycheck and tax is withheld on the combined amount using the normal tables, then the withholding already due on the regular pay is subtracted.
On top of federal income tax, the bonus carries 6.2% Social Security tax (until your year’s wages reach the $184,500 wage base), 1.45% Medicare tax, and an extra 0.9% Additional Medicare Tax on wages above $200,000. Most states with an income tax also withhold on it, and some use their own flat supplemental rate. See the bonus tax guide for the full explanation.
Example: a $10,000 bonus on a $75,000 salary
Single filer, paid biweekly, figures from this calculator. “Take-home” is the bonus after federal, FICA and state tax withholding.
| State | Flat 22%: take-home | Aggregate: take-home | Share withheld (flat) |
|---|---|---|---|
| Texas (no state income tax) | $7,035 | $6,438 | 29.6% |
| California | $6,020 | $5,423 | 39.8% |
| New York | $6,452 | $5,855 | 35.5% |
| Illinois | $6,540 | $5,943 | 34.6% |
The flat method withholds $2,200 of federal tax on this bonus, while the bonus actually adds about $2,200 to the year’s federal tax — a match here because this salary sits in the 22% bracket. The aggregate method withholds $2,797, because it treats the bonus as if every paycheck were that large. Try your own numbers above, then see the overall effect in the paycheck calculator.
Withholding is not your final tax
The amount taken from a bonus is an advance payment, not the tax itself. When you file, your actual tax is computed on your total income for the year. If the flat rate withheld more than your bracket requires, you get the difference back; if you are in a bracket above 22%, you may owe more. If your pay is steady, a new Form W-4 is the tool for adjusting regular withholding, not the bonus rate.
How this estimate works
Federal withholding uses the IRS flat supplemental rate or the Publication 15-T percentage method (aggregate). Social Security and Medicare are calculated incrementally on the bonus, respecting the 2026 wage base and the Additional Medicare Tax threshold. State and local tax and payroll programs such as California SDI are estimated as the difference between your full-year tax with and without the bonus, which is your marginal state rate. The calculator reuses the engine described in our methodology.
Frequently asked questions
Are bonuses taxed at a higher rate?
No. A bonus is ordinary income taxed at the same brackets as the rest of your pay. It can look heavily taxed because employers often withhold a flat 22% federal rate on it, which can be more than your normal withholding rate. The difference is settled when you file your return.
How much federal tax is withheld from a bonus?
If the bonus is paid separately, the employer may withhold a flat 22% (the supplemental rate), or 37% on supplemental wages above $1 million in a year. If it is paid with regular wages, the aggregate method applies the normal withholding tables to the combined amount.
What is the difference between the flat and aggregate methods?
The flat method takes 22% of the bonus. The aggregate method adds the bonus to a regular paycheck, withholds on the total as if it were one payment, then subtracts what the regular pay alone would have withheld. Aggregate often withholds more on large bonuses.
Do I pay Social Security and Medicare on a bonus?
Yes. A bonus is subject to 6.2% Social Security (until your wages reach the $184,500 wage base in 2026) and 1.45% Medicare, plus the 0.9% Additional Medicare Tax on wages above $200,000.
Why is my bonus taxed so much more than my regular paycheck?
Withholding on a one-off payment assumes the amount will repeat, and the flat rate does not account for your actual bracket. Your real tax for the year is calculated on your return, so over-withholding comes back as a refund and under-withholding is owed.
Is state tax withheld from a bonus?
Usually, in states with an income tax. Some states withhold bonuses at a specific flat supplemental rate. This calculator estimates state tax at your marginal state rate, so your actual state withholding may differ.
Sources & methodology
- IRS — Publication 15 (Employer’s Tax Guide): supplemental wages
- IRS — Publication 15-T (2026), Federal Income Tax Withholding Methods
- IRS — Topic no. 751, Social Security and Medicare withholding rates
- Social Security Administration — Contribution and benefit base
Estimates for information only, not tax advice. See our methodology, disclaimer and editorial policy.