2026 federal supplemental rate, single

Bonus after taxes by salary,
withholding vs your real tax rate

Bonuses are withheld at 22% federal supplemental rate (37% above $1M annually), plus FICA, plus state supplemental. The actual tax owed depends on your marginal bracket. If you are in 12%, you over-pay and get a refund at filing. If you are in 32%, you under-pay. Below: the math at every common salary + bonus combination.

The bonus tax myth

Bonuses are not taxed at a higher rate than your salary. They are WITHHELD at a flat 22% federal supplemental rate (a payroll convenience), but the actual tax owed at filing time uses your normal income tax brackets. The 22% withholding rate happens to be close to the 22% federal bracket rate for middle-income earners. For lower earners, 22% over-withholds; for higher earners, 22% under-withholds.

Tax estimate, not tax advice

Scenarios

Bonus tax math at common salary + bonus combinations

"Withheld" is what your employer takes at the bonus paycheck (22% federal supplemental + FICA). "Actual tax" is what you actually owe based on the additional income at your marginal bracket. "Difference" is positive when you got money back at filing (over-withheld), negative when you owed more.

SalaryBonusWithheld (22% + FICA)Actual federal tax on bonusNet bonus you keepEffective rate on bonus
$50,000$5,000$1,483$983$4,01819.7%
$75,000$7,500$2,224$2,224$5,27629.6%
$100,000$10,000$2,965$2,965$7,03529.6%
$100,000$25,000$7,413$7,524$17,47730.1%
$150,000$25,000$7,413$7,913$17,08831.6%
$200,000$50,000$11,725$16,103$33,89732.2%
$300,000$100,000$23,450$37,350$62,65037.4%

"Net bonus you keep" is the bonus minus the actual federal tax on that bonus (computed as the difference in total federal tax with and without the bonus). FICA is included in this calculation. State tax not included.

Walk-through

How bonus tax actually works

The percentage method (most common)

When your employer pays a bonus separately from your regular paycheck, the IRS allows two withholding methods. The percentage (flat) method takes a fixed 22% federal supplemental tax (37% on supplemental wages above $1 million per year) plus FICA plus state supplemental. This is the most common approach because it is simpler for payroll systems.

Example: $10,000 bonus at $100,000 base salary. Federal supplemental 22% = $2,200. Social Security 6.2% = $620 (you are below the cap at $110K total wages). Medicare 1.45% = $145. State supplemental varies (CA 10.23% = $1,023; TX $0; NY 11.7% = $1,170; PA 3.07% = $307). Total federal-only withholding on the $10K bonus: $2,965 in a no-state-tax state. Net bonus deposit: $7,035. Add state tax for higher-tax states.

The aggregate method (less common)

The aggregate method combines the bonus with your regular pay for that pay period and computes withholding as if the combined amount were a single (very large) paycheck, then subtracts what was already withheld on regular pay. Math: $5,000 regular paycheck + $10,000 bonus = $15,000 combined paycheck. The IRS withholding tables would treat this as if you earned $15,000 every two weeks ($390K annualised), pushing the marginal withholding rate to 35% on most of the bonus.

Aggregate method withholding is typically MUCH higher than percentage-method withholding. Both reconcile to the same actual tax at filing time, but the cash-flow effect of aggregate is much more painful in the short term. Most employers use percentage method to avoid the perception that bonuses are "taxed at 35-40%."

The actual tax owed at filing time

At filing time (April), the IRS recomputes your federal tax based on TOTAL annual wages including the bonus. The 22% withheld on the bonus is treated as a tax payment, like any other withholding. Your actual federal tax depends on your marginal bracket at total income. If your marginal bracket is 22%, the 22% withholding roughly matches and you neither owe nor receive a refund attributable to the bonus. If your marginal bracket is 12%, the 22% withholding overpaid by 10 percentage points and you get a refund. If your marginal bracket is 32%, the 22% withholding underpaid by 10 percentage points and you owe more at filing.

Source for federal supplemental withholding rules: IRS Publication 15-T (2026), section on supplemental wage payments.

FICA on bonuses (always applies)

FICA applies to bonuses the same as regular wages. Social Security 6.2% on the bonus amount, capped at the $184,500 annual wage base. Medicare 1.45% on the bonus with no cap. Additional Medicare 0.9% if your YTD wages cross $200,000 (single) or $250,000 (MFJ). For most middle-income earners receiving a $5K-$15K bonus, FICA on the bonus is straightforward 7.65%. For high earners crossing the SS cap during the bonus pay period, only the portion below the cap incurs the 6.2% Social Security tax.

Calculator

Compute your bonus tax

Enter your salary, bonus, filing status, and state. The calculator shows withholding (what your employer takes) and actual tax (what you owe at filing).

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Sources

Where the 2026 numbers come from

Frequently Asked Questions

Why is my bonus taxed at 40%?+
It is not taxed at 40%, it is WITHHELD at roughly 30-37% combined. The federal supplemental withholding rate is a flat 22% on bonus pay. Add 6.2% Social Security (until you cross $184,500 in annual wages), 1.45% Medicare, and your state supplemental rate (0% to about 11%). Total withholding feels high (~30-40%), but the actual tax owed at filing time depends on your marginal income tax bracket. If your marginal bracket is 12%, the 22% withheld is actually MORE than you owe and you get money back at filing. If your marginal bracket is 32-37% (high earners), the 22% withholding under-collects.
What is the federal supplemental wage rate in 2026?+
22% for the first $1 million of supplemental wages per employee per calendar year. 37% on supplemental wages above $1 million in the same year. Supplemental wages include bonuses, commissions, RSU vesting, severance pay, retroactive raises, accumulated sick leave, and similar lump-sum payments. The 22% rate is the same since 2018 when the Tax Cuts and Jobs Act simplified the supplemental withholding tables. Source: IRS Publication 15-T (2026).
How much of my bonus will I actually keep?+
After all federal, state, and FICA taxes (the actual tax, not just withholding), most middle-income earners keep about 60-72% of their bonus. At a $50K salary with a $5K bonus, expect to keep around 70%. At $100K with $10K bonus (deeper in 22% bracket), expect to keep around 65%. At $200K with $50K bonus (24% bracket plus higher state), expect to keep around 60%. The exact percentage depends on your state, your salary, and your bonus size relative to your salary.
Can I put my bonus into my 401(k) to avoid taxes?+
Yes if your employer's 401(k) plan allows it, with limits. A pre-tax 401(k) contribution from your bonus reduces federal income tax but NOT FICA. Some employer plans allow you to set a separate (often higher) contribution percentage for bonus pay so you can defer most or all of the bonus into the 401(k). You are still capped at the annual $23,500 employee elective deferral limit (2026). FICA still applies to the full bonus before the 401(k) deduction. Even with full 401(k) deferral, you owe roughly $382 of FICA on a $5,000 bonus (7.65%).
Is the percentage method or aggregate method better for bonus withholding?+
Most employers use the percentage (flat 22%) method on a separate bonus paycheck. A few use the aggregate method, which adds the bonus to your regular pay for that pay period and computes withholding as if the combined amount were a single paycheck, then subtracts what was already withheld on regular pay. The aggregate method often withholds MORE because the temporary income spike pushes the implied annual income into a higher bracket. Both methods reconcile at filing time to the same actual tax owed, just with different cash-flow timing.
Are signing bonuses taxed differently?+
No. A signing bonus is treated identically to any other supplemental wage: 22% federal supplemental withholding, FICA, state supplemental, all in the year the bonus is paid. If the offer letter has a clawback clause (you must return the bonus if you leave within X months), and you do leave and return the bonus in a different tax year, you may need to amend your prior-year return or claim a 'claim of right' deduction in the year of repayment. Consult a CPA if a clawback applies.
Why does my paycheck feel small the pay period AFTER my bonus?+
Often nothing changed in the regular paycheck mechanics, but psychological contrast makes the regular paycheck look small after a large bonus deposit. If your regular paycheck does shrink after a bonus, two possible reasons: (1) you crossed the Social Security wage base ($184,500) during the bonus pay period, but that would actually increase your subsequent regular paychecks by 6.2% as the SS withholding stops; or (2) your withholding elections changed (uncommon). If your paycheck genuinely dropped, check the YTD wage and withholding figures on your pay stub against the prior pay period.