Bonus Tax Calculator 2026: Flat 22% vs Aggregate Method
When you receive a bonus, your employer must withhold federal income tax and FICA before paying you. The IRS provides two methods for calculating federal withholding on supplemental wages like bonuses, commissions, and severance pay. The most common is the flat 22% method (or 37% on amounts exceeding $1,000,000). The alternative aggregate method combines your bonus with regular wages and computes withholding on the total. Use this calculator to estimate your take-home pay under either method, including Social Security (6.2%) and Medicare (1.45%) taxes.
How Bonus Tax Withholding Works
Flat Percentage Method (22%)
Under IRS Publication 15, employers can withhold a flat 22% on supplemental wages up to $1,000,000 per year. This is the simplest and most widely used method. It applies regardless of your regular income or filing status. If your total supplemental wages for the year exceed $1,000,000, the excess must be withheld at 37% (the top marginal rate for 2026).
Aggregate Method
The aggregate method treats your bonus as part of your regular pay for the pay period. Your employer adds the bonus to your most recent paycheck, calculates the total withholding as if it were a single regular payment, then subtracts the tax already withheld on your regular wages. The remainder is withheld from the bonus. This method can result in higher or lower withholding than the flat method, depending on your income level and bracket.
FICA on Bonuses
Regardless of the withholding method, bonuses are subject to FICA taxes: Social Security at 6.2% (up to the $184,500 wage base) and Medicare at 1.45% (no cap). If your combined wages and bonus exceed $200,000, an additional 0.9% Medicare surtax applies to the excess.
Worked Examples
Example 1: $5,000 Bonus, Flat Method
Profile: $5,000 bonus, flat 22% method, single filer
Federal withholding (22%) = $1,100.00 Social Security (6.2%) = $310.00 Medicare (1.45%) = $72.50 Total withholding = $1,482.50 Net bonus = $3,517.50
Tax on combined income ($60,000 + $10,000 = $70,000) minus YTD withholding ($7,872.00) Federal withholding = $0.00 Social Security (6.2%) = $620.00 Medicare (1.45%) = $145.00 Total withholding = $765.00 Net bonus = $9,235.00
Example 3: $25,000 Bonus, Flat Method
Profile: $25,000 bonus, flat 22% method, single filer
Federal withholding (22%) = $5,500.00 Social Security (6.2%) = $1,550.00 Medicare (1.45%) = $362.50 Total withholding = $7,412.50 Net bonus = $17,587.50
Frequently Asked Questions
What is the flat 22% bonus tax rate?
The IRS allows employers to withhold federal income tax on supplemental wages (bonuses, commissions, etc.) at a flat 22% rate, per Publication 15. This is the most common method. For bonus amounts exceeding $1,000,000, the excess is withheld at 37%. This is a withholding rate, not your actual tax rate, your final tax liability depends on your total income and bracket.
What is the aggregate method for bonus withholding?
The aggregate method treats your bonus as if it were a regular paycheck. Your employer combines the bonus with your most recent regular pay period, calculates withholding on the combined total using the standard wage bracket tables, then subtracts the tax already withheld on your regular wages. The result is the withholding on the bonus. This method often results in higher withholding than the flat 22% method for most earners, but may be lower for low-income workers.
Is the 22% bonus tax my actual tax rate on bonuses?
No. The 22% is a withholding rate, not your final tax rate. Bonuses are taxed as ordinary income at your marginal bracket rate when you file your return. If your actual marginal rate is lower than 22%, you'll get a refund of the difference. If it's higher (e.g., 24% or 32%), you may owe additional tax.
Do I still pay FICA taxes on my bonus?
Yes. Bonuses are subject to Social Security tax (6.2% up to the $184,500 wage base in 2026) and Medicare tax (1.45% on all wages, plus an additional 0.9% on wages above $200,000). FICA applies regardless of which withholding method your employer uses.
What happens if my bonus exceeds $1 million?
For the flat method, the first $1,000,000 of supplemental wages is withheld at 22%. Any amount above $1,000,000 is withheld at 37% (the top marginal income tax rate). This higher rate applies only to the portion exceeding $1M, not the entire bonus.
Can I choose which withholding method my employer uses?
Generally, your employer decides which method to use, not you. However, you can adjust your W-4 to request additional withholding or claim allowances that affect your overall tax withholding. If your bonus withholding results in overpayment, you'll receive a refund when you file your tax return.
Does state tax apply to bonuses?
In most states with an income tax, yes. Many states have a supplemental withholding rate specifically for bonuses (similar to the federal flat rate). States without income tax (Texas, Florida, Nevada, etc.) do not withhold state tax on bonuses. This calculator focuses on federal and FICA withholding only.
Bonus Tax Calculator
Estimated Total Withholding$1,482.50
On a $5,000.00 bonus, estimated total withholding is $1,482.50 — you take home $3,517.50.
Line
Value
Bonus Amount
$5,000.00
Federal Withholding (22.00%)
$1,100.00
Social Security (FICA)
$310.00
Medicare (FICA)
$72.50
Total FICA
$382.50
Total Withholding
$1,482.50
Net Bonus (Take-Home)
$3,517.50
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