Arizona Bonus Tax Calculator 2025
Compare Arizona's bonus tax rates with all 50 states using our comprehensive bonus tax calculator directory.
How to Use This Calculator
Arizona Bonus Tax Rate 2025
Arizona taxes bonuses at 2.5% - the same flat rate as regular income. Arizona has a flat income tax rate of 2.5 percent, making it one of the lowest state tax rates in the country.
Your total bonus taxes include:
- Federal withholding: 22% (for bonuses under $1 million)
- Arizona state tax: 2.5%
- FICA taxes: 7.65% (Social Security + Medicare)
- Total combined rate: About 32.15%
How Arizona Bonus Taxes Work
Arizona keeps bonus taxation simple. Your employer withholds a flat 22% for federal taxes if your bonus comes in a separate check from your regular paycheck. Then they add Arizona's 2.5% state rate and FICA taxes.
What Makes Arizona Different
Arizona's flat rate of 2.5 percent is the lowest in the country, making it more competitive than any other state that imposes these taxes. You don't have to worry about tax brackets or complex calculations - every dollar of your bonus gets taxed at the same 2.5% rate.
Real Arizona Bonus Examples - What You'll Actually Get
| Bonus Amount | Federal (22%) | AZ State (2.5%) | Social Security (6.2%) | Medicare (1.45%) | Take-Home |
|---|---|---|---|---|---|
| $1,500 | $330 | $37.50 | $93 | $21.75 | $1,017.75 |
| $3,000 | $660 | $75 | $186 | $43.50 | $2,035.50 |
| $5,000 | $1,100 | $125 | $310 | $72.50 | $3,392.50 |
| $10,000 | $2,200 | $250 | $620 | $145 | $6,785 |
Calculations based on 2025 tax rates. Your actual withholding may vary based on your W-4 elections.
Arizona vs. Other States - Why Location Matters
| State | State Bonus Tax | Total Rate | Savings vs Arizona |
|---|---|---|---|
| Arizona | 2.5% | 32.15% | Base |
| Nevada | 0% | 29.65% | $125 on $5,000 bonus |
| Colorado | 4.4% | 33.55% | -$70 on $5,000 bonus |
| New Mexico | Up to 5.9% | Up to 35.05% | -$145 on $5,000 bonus |
| California | Up to 13.3% | Up to 42.45% | -$515 on $5,000 bonus |
| Utah | 4.65% | 33.8% | -$82.50 on $5,000 bonus |
Bottom line: Arizona ranks as one of the most bonus-friendly states in the country.
Arizona Cities - Same Rate Everywhere
Good news if you work in Arizona - there's no city or local income tax. Your bonus tax rate is identical whether you work in Phoenix, Tucson, Mesa, Chandler, Scottsdale, Glendale, Tempe, Flagstaff, or Yuma.
This makes Arizona simpler than states like Ohio or Pennsylvania where city taxes can add another layer.
Smart Bonus Strategies for Arizona Workers
Timing Your Bonus
Arizona's flat 2.5% rate means timing doesn't affect your state taxes like it would in progressive tax states. But you can still optimize:
- Max out your 401(k): Contribute to retirement accounts to reduce federal taxes
- End-of-year planning: Consider deferring bonuses to January if you expect lower income next year
- Multiple bonuses: No penalty for receiving several bonuses throughout the year
Arizona Tax Credits You Can Use
Arizona offers unique tax benefits that can help offset bonus taxes:
- Charitable contribution credits: Dollar-for-dollar tax credits (not just deductions) for donations to certain Arizona nonprofits
- School tax credits: Up to $400 ($800 for married couples) for donations to school programs
- Tax credit for donations to working poor: Up to $800 for qualifying charitable organizations
Frequently Asked Questions
Is Arizona a good state for bonus taxes?
Yes, Arizona's 2.5% flat rate ranks among the lowest tax states. You'll save significantly compared to high-tax states like California's bonus tax rates (up to 13.3%) or New York's bonus taxation (up to 10.9%).
Do I pay city taxes on bonuses in Arizona?
No, Arizona has no local income taxes on bonuses or regular income, unlike many other states.
How much will I take home from a $5,000 bonus in Arizona?
Approximately $3,392.50 after federal (22%), state (2.5%), and FICA taxes (7.65%).
Can I reduce my Arizona bonus taxes?
Yes, through:
- Increasing 401(k) contributions
- Using Arizona's charitable tax credits
- Taking advantage of school tax credit programs
When do Arizona bonus taxes get paid?
Taxes are withheld when you receive the bonus. Final tax liability is calculated when you file your Arizona state return.
Does Arizona tax bonuses differently than regular income?
No. The tax rate is 2.5 percent, just like for other income.
Can I change my withholding to keep more of my bonus?
Yes, but be careful. You'll still owe the same taxes at year-end. Talk to a tax professional about whether this makes sense for your situation.
What if my bonus pushes me into a higher federal tax bracket?
The 22% federal withholding on bonuses is separate from your regular income tax brackets. Your actual tax liability gets calculated when you file your return.
Do stock options count as bonuses in Arizona?
Stock compensation can be complex. Arizona taxes it at the same 2.5% rate, but timing and vesting schedules affect when you owe taxes.