How are bonuses taxed in 2026?
For the IRS, a bonus is a supplemental wage, like commissions or severance pay. Publication 15 (2026) keeps the withholding rate at 22%, made permanent by the 2025 tax law, and gives your employer two ways to withhold federal income tax:
- Flat rate: 22% of the bonus, whatever you put on your Form W-4, if the bonus is paid or identified separately from your regular pay.
- Aggregate method: the bonus is added to a regular paycheck and tax is withheld on the total as if it were a normal paycheck, minus what was already withheld on the regular pay.
Above $1 million of supplemental wages in the calendar year, the excess is withheld at 37%, with no other option.
How much of a $5,000 bonus will I take home?
With the 22% flat rate and no state income tax:
| Item | Amount |
|---|---|
| Bonus | $5,000.00 |
| Federal income tax (22%) | −$1,100.00 |
| Social Security (6.2%) | −$310.00 |
| Medicare (1.45%) | −$72.50 |
| Take-home | $3,517.50 |
Your state may withhold its own tax on top. Social Security stops once your wages for the year pass $184,500, as we explain in the guide to FICA tax 2026.
Is 22% what I really pay on my bonus?
No. Withholding is a prepayment. When you file, the bonus is added to your other income and taxed at your own brackets:
- If your top bracket is 12%, the 22% withheld is too much and you get the difference back as part of your refund: $500 on a $5,000 bonus.
- If it is 24% or higher, the 22% falls short and you owe the rest: $100 more on a $5,000 bonus in the 24% bracket.
Find your bracket in the guide to 2026 tax brackets, or run your whole year in the income tax calculator.
Can I lower the tax on my bonus?
You can’t change the 22% flat rate, but you can send part of the bonus to your 401(k) if your plan allows deferrals from bonuses: that part isn’t subject to federal income tax withholding, though it still pays FICA. The 2026 limit is $24,500, and it must come out of 2026 paychecks, as we explain in the 401(k) contribution deadline guide.
Official sources
- IRS Publication 15 (2026): Employer's Tax Guide · section 7: supplemental wages, 22% flat rate and 37% over $1 million
- IRS Topic No. 751: Social Security and Medicare Withholding Rates · Social Security and Medicare rates
- IRS Revenue Procedure 2025-32: 2026 inflation adjustments (tax brackets, standard deduction, credits) · 2026 tax brackets