Bonus Tax Calculator — How Are Bonuses Taxed?

When a bonus is paid separately from regular wages, employers use the flat-rate (percentage) method: a flat 22% federal income tax is withheld, rising to 37% on the portion of cumulative supplemental wages over $1,000,000 in a calendar year. Social Security (6.2%) and Medicare (1.45%, plus 0.9% above $200,000) also apply. This is withholding, not a separate tax rate — your actual tax on the bonus is reconciled when you file.

It was withheld, not taxed, at a higher combined rate: 22% federal + 7.65% FICA + your state rate can total 30–40%+. If that withholding exceeds your real marginal rate for the year, the difference comes back as a larger refund (or a smaller balance due) when you file.

Instead of the flat 22%, some employers add the bonus to your most recent regular paycheck and withhold as if that combined amount were your pay every period. This usually withholds more than 22% because it pushes the combined figure into higher withholding brackets. Employers choose which method to use; you cannot pick.

You get back any amount withheld beyond your actual tax liability for the year, as part of your normal refund. The bonus itself is still taxable income — you do not get the tax on it fully refunded, only any over-withholding.

Minnesota applies a flat 6.25% state supplemental withholding rate to bonuses paid separately, on top of the flat 22% federal rate and 7.65% FICA. See the Minnesota bonus tax calculator for a take-home estimate on a specific amount.

In Texas, Florida, Tennessee, Nevada, Washington, Wyoming, South Dakota and Alaska there is no state income tax on a bonus. Only the flat 22% federal supplemental rate (37% above $1M) and 7.65% FICA are withheld.

The final tax is the same — a bonus is ordinary income and lands in the same brackets as salary. Only the up-front withholding differs: separate bonuses use the flat 22% supplemental method rather than the wage-bracket tables used for regular paychecks.