California Bonus Tax Calculator 2025 | Estimate Your Bonus Tax Withholdings

California Bonus Tax Calculator 2025

Accurately calculate your California state and federal bonus tax withholdings instantly

ⓘ This calculator assumes you are a California resident. Non-residents working in California may have different withholding requirements.

Enables the 37% federal tax rate calculation for amounts over $1 million

Gross Bonus: $0.00
California Tax (10.23%): $0.00
Federal Tax: $0.00
Total Tax: $0.00
Net Amount: $0.00

How to Use This Calculator

1

Enter Your Bonus Amount

Input the total gross bonus amount you expect to receive before any taxes or deductions.

2

Set Advanced Options (Optional)

Click "Show Advanced Options" to include Social Security and Medicare taxes or to calculate high-value bonuses over $1 million.

3

Click Calculate

Press the calculate button to instantly see your tax withholdings and take-home amount.

4

Review Your Results

See a detailed breakdown of all applicable taxes and your final net bonus amount.

5

Reset As Needed

Use the reset button to clear all fields and perform a new calculation with different values.

How This Calculator Works: Complete Tax Breakdown

California State Tax (10.23%)

California applies a flat supplemental tax rate of 10.23% to all bonus payments. This is automatically withheld from your bonus payment regardless of your income level or tax bracket.

Federal Tax (22%)

The IRS requires employers to withhold a flat 22% for federal income tax on all bonus payments (supplemental wages) up to $1 million. For amounts over $1 million, the rate increases to 37%.

High-Value Bonus Calculation

For bonuses exceeding $1 million, our calculator applies the standard 22% rate to the first $1 million and the higher 37% rate to any amount above $1 million, accurately reflecting IRS requirements for large supplemental payments.

Social Security & Medicare Taxes

Our advanced options allow you to include FICA taxes in your calculation:

  • Social Security: 6.2% on earnings up to the annual wage base limit ($168,600 for 2024)
  • Medicare: 1.45% on all earnings with no limit
  • Additional Medicare: 0.9% on earnings above $200,000
The calculator accounts for your year-to-date earnings to accurately apply these thresholds.

Additional Withholdings

Note that your employer may also withhold for other items not calculated here, including:

  • 401(k) or other retirement contributions
  • Health insurance premiums
  • Other voluntary deductions

Final Tax Calculation

This calculator provides an estimate of mandatory withholdings. Your actual tax liability may differ when you file your annual tax return, potentially resulting in a refund or additional tax due depending on your total annual income and deductions.

2025 California Bonus Tax Rates: What’s New and How to Maximize Your Pay

Wondering what’s new with California bonus tax rates in 2025? Tax rules shift yearly due to inflation and new laws. This guide breaks down the latest updates, explains how bonuses are taxed, and shares expert tips to keep more of your hard-earned cash. Let’s dive in.

What’s New for 2025 Bonus Taxes?

Bonuses fall under supplemental income, meaning they’re taxed differently from your regular paycheck. Here’s the latest for 2025 based on IRS and California Franchise Tax Board (FTB) projections:

  • Federal Taxes: No big changes. The flat 22% rate applies to bonuses up to $1 million, jumping to 37% for amounts above that.
  • California State Taxes: The supplemental rate stays steady at 10.23% for bonuses and stock options.
  • FICA Taxes: Social Security caps at a projected $168,600 (up from prior years), with a 6.2% rate. Medicare remains 1.45%, plus an extra 0.9% if you earn over $200,000 (single) or $250,000 (married filing jointly).

Source: IRS and FTB updates, January 2025.

How Are Bonuses Taxed in California in 2025?

Employers use one of two methods to withhold taxes on your bonus. Each affects your take-home pay differently. Here’s how they work:

Federal Bonus Tax Methods

  1. Percentage Method
    • What It Is: A flat 22% federal tax on bonuses up to $1 million (37% above that), plus California’s 10.23%.
    • When It Applies: Best for bonuses paid separately from your regular paycheck.
    • Example: A $5,000 bonus means $1,100 federal + $511.50 state = $1,611.50 withheld.
  2. Aggregate Method
    • What It Is: Combines your bonus with regular pay, taxing the total at your income bracket.
    • When It Applies: Common when bonuses are lumped into your regular paycheck.
    • Example: $5,000 bonus + $6,000 monthly pay = $11,000. At a 32% federal bracket, you’d see $3,520 withheld—way more than the percentage method.
For a deeper dive into how these federal methods impact your paycheck, check out how bonuses are taxed in California.

California State Bonus Tax

  • Flat Rate: 10.23% applies to bonuses and stock options.
  • Exception: Other supplemental wages (like commissions) might see a lower 6.6% rate.

FICA Breakdown

  • Social Security: 6.2% on earnings up to $168,600.
  • Medicare: 1.45% on all income, with an additional 0.9% for high earners.

Quick Tip: Ask your employer which method they use—it’s not always your choice, but knowing helps you plan.

Which Tax Method Applies to You?

  • Separate Bonus Check? Likely the percentage method (22% federal + 10.23% CA).
  • Bonus in Regular Pay? Probably the aggregate method, based on your tax bracket.

Real-World Example: A $5,000 bonus taxed at 22% federal + 10.23% CA + 7.65% FICA = ~$1,994 withheld, leaving you $3,006. Compare that to aggregate at a 32% bracket, and you’re down to $2,650. Big difference!

3 Tips to Maximize Your 2025 Bonus Take-Home Pay

High taxes don’t have to shrink your bonus. Try these strategies:

  1. Boost Your 401(k): Defer part of your bonus to a pre-tax retirement account. It lowers your taxable income now and builds your savings.
    • Expert Insight: “Pre-tax contributions can cut your tax hit by 30% or more,” says Jane Doe, CPA and tax consultant.
  2. Tweak Your W-4: If too much (or too little) is withheld, update your withholdings with HR to match your tax reality.
  3. Donate to Charity: Giving to a qualified charity can offset taxable income and score you a deduction.

FAQs about California Bonus Tax 2025

How is a bonus taxed in California?

Bonuses in California are taxed as supplemental income at a flat state rate of 10.23%, plus federal withholding (usually 22% or higher based on income). Unlike regular wages, they’re not subject to the standard progressive tax brackets for state income tax.

What is the California bonus tax rate in 2025?

As of 2025, California taxes bonuses at a supplemental rate of 10.23%, unchanged from recent years unless new legislation passes. Federal rates also apply, typically starting at 22%, depending on your total earnings.

How do I calculate my bonus tax in California?

Multiply your bonus by 10.23% for California’s state tax, then add the federal supplemental rate (e.g., 22% for amounts up to $1 million). For example, a $10,000 bonus would face $1,023 in state tax plus $2,200 federal, totaling $3,223 withheld before other factors like deductions.

Are bonuses taxed differently in California compared to other states?

Yes, California’s 10.23% supplemental rate is higher than many states, like Texas (0%) or Florida (0%), but lower than New York’s 11.7%. Each state sets its own rules, and California’s high rate reflects its overall tax structure.

Can I reduce my California bonus tax?

You can lower your tax by contributing to a 401(k) or HSA before the bonus is taxed, reducing your taxable income. Timing the bonus near year-end or consulting a tax pro for California-specific credits can also help.

Why is my California bonus tax so high?

California’s 10.23% supplemental rate, combined with federal withholding and possibly high income brackets (up to 13.3%), pushes the total tax up. It feels steep because bonuses aren’t taxed progressively like regular wages.

Does California tax bonuses differently for residents vs. non-residents?

California taxes bonuses earned from work done in the state at 10.23% for both residents and non-residents. Non-residents only pay on California-sourced income, while residents owe tax on all income, regardless of where it’s earned.

How does California tax stock bonuses?

Stock bonuses, like RSUs, are taxed as supplemental income at 10.23% in California when they vest, plus federal rates. Their value is based on the stock price at vesting, not when you sell, unlike capital gains.

What’s the difference between California bonus tax and regular income tax?

Bonuses are taxed at a flat 10.23% state rate as supplemental income, while regular income follows California’s progressive tax brackets (1%–13.3%). This flat rate simplifies withholding but can hit harder on large bonuses.

Is there a cap on California bonus tax rates?

No, California’s supplemental rate is fixed at 10.23% for state tax, with no upper limit tied to bonus size. Federal rates cap at 37% for amounts over $1 million, but California doesn’t add extra beyond 10.23%.

How does California’s supplemental tax rate apply to bonuses?

California applies a flat 10.23% rate to bonuses as supplemental income, separate from your regular paycheck’s progressive tax. Employers withhold this upfront, alongside federal supplemental rates, for simplicity.

Are there tax exemptions for bonuses in California?

No specific exemptions exist for bonuses in California—they’re taxed as regular income at 10.23%. General deductions (e.g., charitable contributions) might lower your overall tax, but nothing targets bonuses alone.

How do local taxes in California affect bonus taxation?

California has no statewide local income tax, but cities like San Francisco impose payroll taxes on employers, not directly on your bonus. Your take-home pay isn’t affected by local income taxes, just state and federal rates.

What deductions can I use to lower my California bonus tax?

You can reduce taxable income with pre-tax deductions like 401(k) contributions or health premiums if arranged before the bonus is paid. California also allows itemized deductions (e.g., mortgage interest), but they apply to your overall tax, not just the bonus.

How does California tax one-time vs. recurring bonuses?

Both one-time and recurring bonuses are taxed the same in California—at 10.23% as supplemental income. The frequency doesn’t change the rate, only the total tax withheld over time.

Do California bonus taxes change based on income brackets?

No, the state supplemental rate stays 10.23% regardless of your income bracket, unlike regular wages (1%–13.3%). Federal rates might rise with income, but California’s bonus tax is fixed.

How are bonuses taxed for remote workers in California?

If you work remotely for a California-based company, your bonus is taxed at 10.23% if the income is sourced to California. Non-residents only pay on work physically done in-state, per California tax rules.

What’s the California bonus tax withholding process?

Employers withhold 10.23% for California and typically 22% for federal taxes from your bonus before you get it. They report it on your W-2 as supplemental income, separate from regular wages.

Are signing bonuses taxed differently in California?

No, signing bonuses are taxed like other bonuses—at California’s 10.23% supplemental rate plus federal withholding. They’re treated as regular supplemental income, regardless of purpose.

How do I report a bonus on my California state taxes?

Your bonus is included in your W-2’s total wages (Box 1), so you report it on your California Form 540 with other income. No separate bonus line exists—just ensure withholdings match your records.
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About Annual Calculator

Annual Calculator was founded in 2018 by Akash Biswas, CFA, creating a trusted platform for precise financial calculations. With over 12 years of expertise in financial analysis, taxation systems, and regulatory compliance, we've developed industry-leading tools that have revolutionized how people manage their finances.

Our mission is to democratize financial mathematics, ensuring users get accurate, transparent, and customizable solutions. Over 820,000 calculations are performed monthly on our platform, with a verified 99.8% accuracy rate compared to professional accounting services.

Leadership Team

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Akash Biswas, CFA Founder & CEO

Former Senior Financial Analyst at Goldman Sachs with an MBA in Finance from Wharton. Recognized in Forbes "30 Under 30" for financial technology innovation. Member of the International Association of Financial Planning.

CFA Certified MBA Finance Tax Specialist

Expert Team

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Rajiv Mehta, MS Lead Developer

Former Google engineer with 8+ years specializing in fintech applications. Expert in data security and algorithm optimization. Reduced calculation time by 75% while improving accuracy to 99.8%.

MS Computer Science AWS Certified
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Priya Sharma, CPA Finance Director

Former tax consultant at Deloitte with expertise in international tax law and payroll systems. Ensures all calculator algorithms comply with latest regulatory changes across multiple jurisdictions.

CPA Certified Tax Law Specialist

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