How you will be taxed depends on how your employer treats your bonus, and your bonus could also boost you into a higher tax bracket. While your bonus tax rate won't be 40 percent, you are responsible for other taxes including Medicare, Social Security, unemployment and state or locals taxes, too.
Why Did My Bonus Check Get Taxed 40 Percent? | Sapling
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It comes down to what's called "supplemental income." Although all of your earned dollars are equal at tax time, when bonuses are issued, they're considered supplemental income by the IRS and held to a higher withholding rate. It's probably that withholding you're noticing on a shrunken bonus check.
Here's why your bonus is taxed so high - Business - Insider
www.businessinsider.com > Personal Finance > Taxes
Your bonus is taxed at the same rate as all of your other income. If you're in the 33% tax bracket and you receive a bonus of $100,000, you will pay $33,000 in federal taxes. ... Since your employer may withhold more or less than the actual amount you will pay, this will get sorted out when you pay your taxes.
What is Your Bonus Tax Rate (in 2021)? - Biglaw Investor
www.biglawinvestor.com > bonus-tax-rate
For 2021, the flat withholding rate for bonuses is 22% — except when those bonuses are above $1 million. If your employee's bonus exceeds $1 million, congratulations to both of you on your success! These large bonuses are taxed at a flat rate of 37%.
Free Flat Bonus Pay Calculator (Plus Flat Tax Rates) - OnPay
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