Bonus Tax Calculator (2026)

By Mustafa Bilgic · Last updated 20 June 2026

This bonus tax calculator shows how much of a 2026 bonus you actually keep. The IRS treats bonuses as supplemental wages, most commonly withheld using the flat percentage method: 22% federal (rising to 37% on the portion of supplemental pay above $1 million), plus 6.2% Social Security, 1.45% Medicare, and any state supplemental tax. Enter your bonus to see federal withholding, FICA, and net take-home. Note this is withholding, not your final tax — over-withholding is refunded at filing.

This calculator provides estimates for educational purposes only and is not tax advice. Tax outcomes depend on your full return, withholding elections, pre-tax deductions, and local rules. Consult a qualified tax professional or official IRS and state guidance for your specific situation.

Bonus Tax Calculator

Enter a bonus and press Calculate.

How Bonuses Are Taxed in 2026

The IRS classifies bonuses, commissions, and other extra pay as supplemental wages. Employers can withhold them two ways. The percentage (flat-rate) method — the most common — takes a flat 22% federal, jumping to 37% on supplemental wages above $1 million in a year. The aggregate method lumps the bonus with your regular paycheck and withholds using your W-4, which can pull more or less. FICA (6.2% Social Security up to $184,500 + 1.45% Medicare) always applies on top.

Worked Example: $10,000 Bonus (Percentage Method)

Withholding2026 rateOn $10,000
Federal supplemental22%$2,200
Social Security6.2%$620
Medicare1.45%$145
Net take-home$7,035

So a $10,000 bonus leaves about $7,035 in a no-state-tax state — you keep roughly 70%. Add a state supplemental rate (for example California’s 6.6%) and the take-home drops further.

Withholding Is Not Your Final Tax

The flat 22% is a withholding rate, not a tax bracket. If your real marginal rate is lower than 22%, you get the excess back as a refund when you file; if it is higher (24%, 32%, 35%, 37%), you may owe a little more. The bonus is ultimately taxed as ordinary income with the rest of your wages. That is why a bonus can feel “over-taxed” up front but balance out at tax time.

The $1 Million Supplemental Threshold

Once your supplemental wages exceed $1 million in a calendar year, the portion above $1 million is withheld at the top 37% federal rate — mandatory, not optional. This mostly affects executives and large signing bonuses. The calculator applies 22% up to $1 million and 37% beyond it automatically.

Reduce the Tax Bite on a Bonus

You can soften a bonus’s tax hit by routing part of it into a traditional 401(k) or HSA (pre-tax), which lowers taxable income, or by timing a deductible expense in the same year. For the difference between the percentage and aggregate methods, see our aggregate vs percentage bonus guide.

Frequently Asked Questions

How much tax is taken out of a bonus in 2026?

Under the percentage method, 22% federal is withheld (37% on supplemental pay over $1 million), plus 6.2% Social Security up to $184,500 and 1.45% Medicare. A $10,000 bonus nets about $7,035 in a no-state-tax state.

Why is my bonus taxed at 22%?

The 22% is the IRS flat supplemental withholding rate, not a tax bracket. It is the standard employer method for bonuses. Your actual tax is settled on your return, so you may get part of it back or owe a bit more.

Are bonuses taxed higher than regular pay?

Not in the end. Bonuses are ordinary income taxed at your normal rates. The 22% flat withholding can be higher or lower than your real rate, but the difference is reconciled when you file your return.

How can I lower the tax on my bonus?

Direct part of the bonus into a pre-tax 401(k) or HSA to reduce taxable income, or pair it with a deductible expense in the same year. You cannot avoid the 22% withholding up front, but you can reduce your final tax.

What happens to bonuses over $1 million?

The portion of supplemental wages above $1 million in a calendar year is withheld at the mandatory 37% federal rate. Amounts up to $1 million use the 22% rate. This applies regardless of your W-4.