Withholding is not final tax
The 22% rate is a payroll withholding method, not a special income-tax rate for bonuses. Filing status, total annual income, deductions, credits, and other payments determine the return result.
Supplemental wage withholding
Why a bonus may be withheld at 22% or by the aggregate method
A separately identified bonus of $1 million or less can generally use the optional 22% federal withholding rate when federal income tax was withheld from regular wages in the current or prior year. The employer may instead use the aggregate method; the employee does not choose the payroll method.
This guide covers federal withholding on a common employee bonus paid in 2026. State withholding, supplemental wages over $1 million, no-withholding payroll histories, nonresident rules, and unusual payment arrangements require separate review.
Start with how the bonus is paid
If regular wages and a bonus are combined without identifying each amount, the employer withholds as though the total were one regular payroll payment. When the bonus is separately identified and the regular-wage withholding condition is met, Publication 15 permits either a flat 22% method or an aggregate calculation. Supplemental wages above $1 million during the calendar year are subject to the mandatory 37% rule on the excess.
$1,000 bonus example
Using the optional flat method, federal income tax withholding is $1,000 times 22%, or $220. Publication 15's aggregate example combines a $1,000 bonus with $2,000 of recent regular wages, calculates $179 on the $3,000 combined amount, and subtracts $65 already withheld from regular wages. That leaves $114 withheld from the bonus. The methods can produce different withholding even though the employee reports the same taxable bonus on the return.
FICA still applies
Regardless of the federal income-tax method, the bonus is generally subject to Social Security and Medicare taxes and may be subject to FUTA. Year-to-date Social Security wages still control the annual cap.
Common payroll mistakes
Do not promise that every bonus will be withheld at 22%, apply 22% when the regulatory conditions are absent, or omit the bonus from payroll-tax wages. Reconcile the pay stub to the employer's selected method.
Official sources checked 2026-09-03: IRS Publication 15 (2026), section 7, IRS Publication 15-T (2026), and Treasury Decision 9276.