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Tax software
Turn this estimate into a filing plan when you’re ready.
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Bonus calculator
Two different questions get mixed together. What tax does the bonus create, and what will the employer withhold on the check?
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Aggregate versus 22%
The aggregate method adds the bonus to the year and subtracts the tax on salary alone. That is the difference in the annual bill under this estimate. Many employers instead withhold federal tax on supplemental wages at a flat 22%. That is a withholding convention, not a special tax bracket. If you are already in the 22% federal bracket, the two federal numbers often match. State and local tax still follow the aggregate difference here.
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Savings account
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Learn moreQuestions
Is a bonus taxed at 40%?
Not as a special rate. Withholding can look heavy because it is a lump sum on top of wages that have already used the standard deduction. The return uses the same brackets as the rest of your income.
What is the aggregate method?
Add the bonus to annual wages, compute tax, then subtract the tax on salary alone. That difference is the tax attributable to the bonus under this estimate.
What is the 22% supplemental rate?
Many employers withhold federal tax on supplemental wages at a flat 22%. That is a withholding convention, not a different federal bracket. State and local here still follow the aggregate difference.