Why is my bonus taxed so high?

Bonuses use a flat 22% federal withholding rate, which may be higher or lower than your regular rate. You'll reconcile the difference when you file your tax return.

Will I get bonus taxes back?

If the 22% flat rate is higher than your actual tax bracket, you'll get a refund when you file. If it's lower, you may owe additional tax.

Is there a way to reduce bonus taxes?

You can request that your employer apply the bonus to a month with higher 401(k) contributions, or contribute the bonus directly to retirement accounts where allowed.

CalcTrust

Updated for 2025 Tax Rules

Bonus Tax Calculator

Bonuses are taxed differently than regular wages. The IRS requires employers to withhold a flat 22% for federal taxes on bonuses up to $1 million, plus state taxes and FICA.

Last updated: Dec 2025

View Methodology

Configuration

Bonus Amount

Filing Status

State

Annual Base Salary

For Social Security cap calculation

Overview

How It Works

Most employers use the "percentage method" which withholds 22% for federal tax (flat rate for supplemental wages under $1M), plus your state's supplemental wage rate, Social Security, and Medicare.

Calculation Formula

Net Bonus = Bonus - Federal (22%) - State Tax - Social Security (6.2%) - Medicare (1.45%)

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