Bonus tax · supplemental wages · 2026
Bonus tax calculator
Why did my bonus feel taxed almost in half?
Because of how bonuses are withheld, not how they're taxed. The IRS treats a bonus as supplemental wages, so your employer withholds a flat 22% federal rate — plus Social Security, Medicare and your state — which often lands near 30–40% off the top. But that's withholding, not your final tax. This calculator shows exactly what's taken now, and what you'll likely get back when you file.
Verified 12 August 2026
Information, not tax advice. Uses verified 2026 rules: 22% federal supplemental rate (37% above $1M), Social Security 6.2% to the $184,500 wage base, Medicare 1.45%, and approximate state supplemental rates. "Actual tax" estimates your marginal federal rate on the bonus given your salary. Your real result depends on your full return. Verified 12 August 2026. How we calculate.
Withholding is not the same as tax
This is the single most misunderstood thing about bonuses. When your employer runs your bonus through payroll, they usually use the percentage method: a flat 22% federal withholding, regardless of your actual tax bracket. Add 7.65% for Social Security and Medicare, plus your state rate, and a big chunk vanishes before the money reaches you. On a $10,000 bonus that can feel like losing $3,000–$4,000.
But withholding is just a prepayment of tax, not the tax itself. Your bonus is ultimately taxed at your ordinary marginal rate — the same as the rest of your income. If that rate is below 22%, you were over-withheld and the difference comes back as a refund. If it's above 22%, you'll owe a little more at filing. Either way, the scary paycheck number isn't the real cost.
How to keep more of a bonus
The one genuinely effective move is to divert the bonus into a pre-tax account — a 401(k) or HSA — before it's taxed at all. If your employer allows it, contributing part of the bonus to your 401(k) reduces the taxable amount dollar for dollar, and it's often the difference between the bonus disappearing and it actually building something. The FICA portion still applies, but the income-tax withholding doesn't.