Why the Withholding and the Tax Are Different
Employers usually withhold federal tax on a bonus paid separately from your paycheck at a flat 22% (the IRS "percentage method" for supplemental wages in Publication 15). Above $1 million of supplemental pay in one year, the rate on the excess is a mandatory 37%. That 22% is a withholding shortcut, not a separate tax. On your return the bonus is just more wages taxed at your bracket, so people in the 10% or 12% bracket usually get part of it back, and people in the 24% bracket or higher usually owe a little more. The calculator shows both numbers.
Social Security (6.2%) stops once your wages for the year reach the 2026 wage base of $184,500, so a bonus late in a high-earning year may have no Social Security taken out. Medicare is 1.45% on everything, and your employer adds 0.9% on wages above $200,000.
How Much of a $5,000 Bonus You Keep (Single, 2026 Federal Only)
State tax comes on top. In a state with a flat income tax the bonus is taxed at that flat rate; in a graduated-rate state it is taxed at your top bracket. Pick your state in the calculator: it uses the same 2026 state brackets as the paycheck calculator. Some states set their own flat withholding rate for bonuses, so the state amount taken from your check can differ from the tax you owe, just like the federal 22%. City and county income taxes (New York City, Philadelphia, Ohio and Indiana localities) are not included.
Can You Lower the Tax on a Bonus?
Yes, a little. If your plan allows it, sending part of the bonus to a traditional 401(k) avoids federal and most state income tax on that part now (FICA still applies); the 2026 employee limit is $24,500. Bonuses that push income over a threshold can also cost credits or deductions, which this calculator does not model.
Frequently Asked Questions
Why is my bonus taxed so much?
It usually is not taxed more than your salary; it is withheld differently. The flat 22% federal withholding plus 7.65% FICA plus state withholding often takes 30-40% off the check, but if your bracket is 12%, part of the federal withholding comes back as a refund.
What is the federal tax rate on bonuses in 2026?
Employers withhold 22% on supplemental wages up to $1 million in a year and 37% above that (IRS Publication 15). Your actual tax is your marginal bracket: 10%, 12%, 22%, 24%, 32%, 35% or 37% for 2026.
Do bonuses count toward Social Security tax?
Yes, until your total wages for the year reach the $184,500 wage base for 2026. After that, no more Social Security tax is withheld that year; Medicare continues on all wages.
Is it better to get the bonus in December or January?
It moves the tax into a different year. It helps if you expect a lower bracket next year, or if this year's wages are already past the Social Security wage base and the bonus would land in a year when they are not (the reverse costs you).
Does this calculator include local taxes?
No. City and county income taxes are not included; add them if you live or work in a place that has one.
How to Use This Calculator
- Enter the bonus — the gross amount before anything is taken out.
- Enter your other wages — your expected salary for the year, so the bracket and Social Security cap are right.
- Pick filing status and state — the state tax uses 2026 brackets for all 50 states and DC.
- Read both lines — what the check shows (withholding) and what you actually owe at tax time.
📚 Sources & References- [1] IRS. Publication 15 (Circular E), Employer's Tax Guide: supplemental wages (22% / 37%). www.irs.gov
- [2] IRS. Revenue Procedure 2025-32: 2026 tax brackets and standard deduction. www.irs.gov
- [3] Social Security Administration. 2026 COLA Fact Sheet (wage base $184,500). www.ssa.gov
- [4] Tax Foundation. State Individual Income Tax Rates and Brackets, 2026. taxfoundation.org
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Editorial Standards — Every calculator is built from peer-reviewed formulas and official data sources, editorially reviewed for accuracy, and updated regularly.
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