Free Bonus Tax Calculator
Bonuses are supplemental wages. In 2026, employers using the federal percentage method withhold a flat 22 percent for federal income tax on bonuses up to $1,000,000 in the year and a mandatory 37 percent on the amount above that, plus 6.2 percent Social Security up to the $184,500 wage base, 1.45 percent Medicare, and any state and local tax. This bonus tax calculator applies those rules to estimate your take-home bonus.
2026 supplemental wage withholdingEstimated take-home bonus
$6,122.50
$10,000.00 gross minus $3,877.50 in estimated deductions. Effective withholding rate 33.78%.
Bonus withholding breakdown
Results update as valid inputs change. Each line is rounded to the cent.
Net bonus
$6,122.50
Estimated take-home after all deductions.
Federal withholding
$2,090.00
22% flat rate.
Total deductions
$3,877.50
Taxes $3,377.50 plus retirement $500.00.
Effective withholding
33.78%
Tax withholding divided by the gross bonus.
| Item | Amount |
|---|---|
| Gross bonusBefore any withholding or deductions | $10,000.00 |
| Pre-tax retirement deduction5% of the bonus, simplified assumption | -$500.00 |
| Federal income tax withholding22% flat supplemental rate on $9,500.00 | -$2,090.00 |
| Social Security6.2% on $10,000.00 (wage base $184,500.00) | -$620.00 |
| Medicare1.45% on $10,000.00 | -$145.00 |
| Additional Medicare0.9% on $0.00 over $200,000.00 | -$0.00 |
| State income tax withholding4.5% on $9,500.00 | -$427.50 |
| Local income tax withholding1% on $9,500.00 | -$95.00 |
| Total deductionsTax withholding $3,377.50 plus retirement $500.00 | -$3,877.50 |
| Net bonus (take-home)Gross bonus minus total deductions | $6,122.50 |
Planning estimate only. This is not tax, payroll, or legal advice. Withholding is a prepayment, not your final tax liability, which is settled on your annual return. Your employer's payroll system, Form W-4, benefit plans, and state and local rules vary and can produce different amounts.
How are bonuses taxed in 2026?
The IRS calls bonuses, commissions, and similar payments supplemental wages. Federal income tax withholding uses one of two methods, while Social Security, Medicare, and state and local taxes are withheld as on regular pay.
Percentage method
If the bonus is identified separately from regular wages and income tax was withheld from regular wages, the employer may withhold a flat 22%. Supplemental wages above $1,000,000 for the year must be withheld at 37%, so a bonus that crosses the threshold is split between the two rates.
Aggregate method
The employer adds the bonus to regular wages for the period, figures withholding on the total using the Publication 15-T tables and your Form W-4, then subtracts the amount withheld from regular wages. This tool approximates that with your rate assumption. The 37% rule above $1,000,000 still applies.
Social Security and Medicare
Employees pay 6.2% Social Security on wages up to $184,500.00 in 2026 and 1.45% Medicare on all wages. Employers also withhold 0.9% Additional Medicare on wages they pay above $200,000.00 in the year.
State and local taxes
Some states have no income tax, some use a flat supplemental rate, and others use their regular withholding tables. Cities and counties with income taxes add their own rate. Enter the rates that apply to you; this tool does not look them up.
Net bonus = gross bonus - retirement - federal - Social Security - Medicare - Additional Medicare - state - local
How to use the bonus withholding calculator
1. Enter the gross bonus
Type the bonus amount before any taxes or deductions, exactly as your offer letter or payroll notice states it.
2. Choose the federal method
Pick the percentage method for a flat 22 percent, or the aggregate estimate and enter the federal rate you expect payroll to apply when the bonus is combined with regular wages.
3. Add year-to-date wages
Enter supplemental, Social Security, and Medicare wages paid earlier this year so the $1,000,000, $184,500, and $200,000 thresholds are applied correctly. Your latest pay stub lists them.
4. Add state, local, and retirement rates
Enter your state and local withholding rates and any pre-tax retirement percentage, then review each deduction, copy the summary, or download it as a text file.
Worked bonus after tax example
A $10,000 year-end bonus, paid separately with the percentage method, to an employee with $95,000 of wages so far, a 5% pre-tax 401(k) deferral, 4.5% state tax, and 1% local tax.
- Retirement: 5% of $10,000 = $500.00, leaving $9,500.00 of income tax wages.
- Federal: 22% of $9,500.00 = $2,090.00.
- Social Security: 6.2% of $10,000 = $620.00. Medicare: 1.45% of $10,000 = $145.00.
- State: 4.5% of $9,500.00 = $427.50. Local: 1% of $9,500.00 = $95.00.
- Total deductions $3,877.50, so the net bonus is $6,122.50 and the effective withholding rate is 33.78%.
Frequently asked questions
How are bonuses taxed in 2026?
The IRS treats bonuses as supplemental wages. If your employer identifies the bonus separately and has withheld income tax from your regular wages, it can withhold federal income tax at a flat 22 percent. Supplemental wages over $1,000,000 in the calendar year must be withheld at 37 percent. Social Security, Medicare, and state and local taxes are withheld as on any other wages.
Why does my bonus seem to be taxed more than my paycheck?
It is usually withheld differently, not taxed differently. A flat 22 percent can be higher than the rate on your regular paycheck, and under the aggregate method payroll treats the combined pay as if you earned it every period. Any over-withholding is credited when you file your annual return.
What is the difference between the percentage and aggregate methods?
The percentage method withholds a flat 22 percent on the bonus. The aggregate method adds the bonus to regular wages for the period, figures withholding on the total with the Publication 15-T tables and your Form W-4, and subtracts what was withheld from regular wages. This tool approximates the aggregate method with a rate you choose, so check your pay stub for the exact amount.
Is bonus withholding the same as the tax I owe?
No. Withholding is a prepayment. Your actual federal tax depends on your total income, filing status, deductions, and credits for the year, and is settled on your tax return. State and local rules vary, and some states use their own supplemental rates.
Official sources
Rates and thresholds for 2026 come from the IRS. Check them before relying on an estimate.
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