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Home > Payroll > Taxes & Garnishments > Why Are My Taxes So High on Bonus Paychecks?
Why Are My Taxes So High on Bonus Paychecks?
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At Leeds West Groups, we understand that bonus paychecks can look very different from regular paychecks, and higher tax withholdings can be surprising.

 

Quick Answer
The IRS requires supplemental wages, such as bonuses, to be federally withheld at a flat 22% rate, regardless of the tax elections on your W-4.

 

What This Means

  • Bonuses and other supplemental pay are taxed differently than regular wages.

  • Federal tax withholding on bonus pay is set by the IRS and cannot be adjusted by HR or Payroll.

  • Your personal W-4 elections do not change the federal withholding rate applied to bonus pay.

 

Other Deductions You May See

In addition to the federal 22% withholding, bonus pay may also be subject to:

  • State and local taxes (where applicable)

  • Social Security and Medicare taxes

  • Any court-ordered garnishments or other legally required deductions

These deductions are required by law and will appear itemized on your pay statement.

 

Important Things to Know

  • The higher withholding on bonus pay does not necessarily mean you will owe more taxes overall.

  • Any over-withholding may be reconciled when you file your annual tax return.

  • HR and Payroll cannot change or refund tax withholdings applied to bonus pay.

 

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Disclaimer:
This article provides general information and guidance and may not address every situation or state-specific requirement. It does not create a contract, guarantee, or promise of any specific outcome. Company policies, practices, and legal requirements may vary by state and may change over time. This article does not replace or supersede applicable laws or official Company policies, handbooks, manuals, or training materials.

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