Dec 12, 2025 · This guide explains what bonuses are, how the bonus tax rate works, and the steps you can take to help understand and navigate the tax impact of this extra income.

Aug 20, 2025 · Just like with a regular paycheck, your employer must withhold taxes from your bonus. Here's how bonuses are taxed, and how to reduce your tax bill.

Dec 27, 2024 · In the U.S., it may seem like bonuses are taxed higher than usual based on the withholding process, but it’s actually not a question of higher or lower percentages; the reality …

Jul 11, 2025 · In 2025, the federal withholding rate for supplemental wages is 22%, up to $1 million. It’s important to note that this $1 million limit does not include a regular salary income. …

Sep 9, 2025 · The federal tax withholding rate for bonuses is 22% for bonuses under $1 million and 37% for bonuses over $1 million. However, the actual amount deducted from your …

The bonus income tax rate is 22%. Any portion over $1 million is taxed at 37%. Employers must also withhold Medicare and Social Security taxes from bonuses.

Nov 1, 2025 · When it comes to actually withholding taxes on your bonus, your employer has two options: the percentage method or the aggregate method. The percentage method is …

Nov 7, 2025 · The federal bonus tax withholding rate is typically 22%. However, employers could instead combine a bonus with your regular wages as though it’s one of your usual …

Dec 8, 2025 · Bonuses are taxed because they're considered taxable income. But the IRS also considers bonuses to be supplemental wages. Essentially, supplemental wages are types of …

Jul 2, 2025 · Bonuses are taxed at the federal level as supplemental income, with a flat withholding rate of: On top of that, bonuses are subject to FICA taxes which include: Social …