Tax Guide · Bonuses · 2026
How Are Bonuses Taxed? Bonus Tax Rate Explained
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A bonus is generally taxable wage income. The amount withheld from the bonus check may look different from a regular paycheck because payroll departments can use special supplemental-wage withholding rules.
Two Federal Withholding Methods
Employers generally use either a separate supplemental-wage method or an aggregate method that combines the bonus with regular wages for withholding. The IRS supplemental wage rate for 2026 — check IRS Publication 15 for the current percentage. Your final annual tax liability is determined when you file your return.
FICA Still Applies to Bonuses
Bonus wages are generally subject to Social Security and Medicare withholding. From the calculator's official-source data, the employee rates are 6.2% for Social Security and 1.45% for regular Medicare withholding.
Example: FICA on a $5,000 Bonus
For a $5,000 bonus, the engine-derived employee FICA estimate is $383: $310 for Social Security plus $73 for Medicare. This example assumes the employee remains below the Social Security wage base and Additional Medicare threshold.
State Withholding and Retirement Elections
State bonus withholding varies. Some states use a supplemental method, while others use their regular withholding method. An eligible retirement-plan contribution election may also affect how much of a bonus reaches your bank account. Check your plan rules and payroll settings before the payment date.
Why a Bonus Can Feel More Heavily Taxed
A bonus can feel more heavily taxed because withholding is collected immediately and may use a different method than your regular check. Withholding is a prepayment, not a separate final tax. Your actual liability depends on your full-year income and return.
Estimate your regular paycheck, then review the bonus calculator.
Calculate your regular take-home →Frequently Asked Questions
What is the federal bonus tax rate in 2026?
The IRS supplemental wage rate for 2026 — check IRS Publication 15 for the current percentage.
Do bonuses get taxed differently than regular pay?
Bonuses are ordinary income for your annual tax return, but employers may use an IRS supplemental-wage withholding method. That can make the paycheck withholding look different from regular wages.
Which states tax bonuses differently?
State bonus-withholding rules vary. Check your state tax authority's current supplemental-wage guidance for the method that applies to your payment.
Figures and methods are based on official-source data encoded in the calculator. Not tax advice. Review the methodology and consult a qualified professional for your situation.