Bonuses are supplemental wages, so how much needs to be withheld?
Calculating bonus pay may not be as straightforward as you think. Use one of our Bonus Pay Calculators (Aggregate method or Percent/Flat method) based on your state’s compliance regulations. Abacus Payroll’s Flat or Percentage Bonus Pay Calculator helps calculate the employee’s takehome pay of the bonus amount after considering what needs to be withheld for the IRS. Typically the flat rate is 25%, but the amount of the bonus will determine the withholding rate.
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