New York Bonus Tax Calculator 2025
For official New York tax information and updates, visit the New York Department of Taxation and Finance.
🚨 NEW: Official 2025 New York Bonus Tax Rates (Just Updated)
Last Updated: June 18, 2025
Good news! The tax rates stayed the same from 2024 to 2025. Here’s what you need to know about your bonus taxes in New York.
Your bonus gets taxed differently than your regular paycheck. It’s called supplemental income. The government takes taxes out right away when you get it.
Federal Bonus Tax Rates 2025 (22% Standard, 37% Million+)
The IRS keeps it simple for most people:
- 22% flat rate – For bonuses under $1 million
- 37% flat rate – For bonuses over $1 million
Your employer uses the percentage method when your bonus comes as a separate check. This is different from your regular paycheck taxes.
If your bonus comes with your regular pay, they might use a different method. But most companies send bonuses separately.
New York State Bonus Tax Rate 2025 (11.70% Supplemental Rate)
New York State takes 11.70% from your bonus. This rate didn’t change from 2024.
Here’s how it works:
- Your employer automatically takes out 11.70%
- This happens for all supplemental wages
- It includes bonuses, commissions, and overtime pay
This isn’t your final tax bill. You might get money back when you file your tax return. Or you might owe more.
NYC Bonus Tax Rate 2025 (4.25% Local Tax)
If you work in New York City, there’s another tax:
4.25% NYC supplemental withholding rate
This applies if:
- Your employer is in NYC
- You’re a NYC resident
- You get bonuses or commissions
Non-residents working in NYC still pay this tax. But residents of other places might get different treatment.
Yonkers Bonus Tax Rates (1.61% Resident, 0.5% Non-Resident)
Yonkers has its own bonus tax rates:
For Yonkers residents: 1.61135% For non-residents working in Yonkers: 0.5%
You pay Yonkers tax if you live there or work there. This gets added to all your other taxes.
Total Tax Burden Example:
- Federal: 22%
- NYS: 11.70%
- NYC: 4.25% (if applicable)
- Yonkers: 1.61% (if applicable)
Your total withholding could be 38-40% of your bonus. But remember, this might not be what you actually owe when you file your taxes.
Percentage Method vs Aggregate Method: Which Costs Less?
Your boss just gave you a bonus! But now you’re wondering how much tax you’ll pay.
There are two ways your employer can take taxes from your bonus. The percentage method and the aggregate method work very differently. One might save you money.
Let’s break down which method costs less for your New York bonus.
When Employers Use Each Method (IRS Rules Explained)
Your employer picks the method based on how they pay you.
Percentage Method happens when:
- Your bonus comes in a separate check
- It’s not mixed with regular pay
- You get severance, commissions, or overtime pay
With this method, your employer takes out 22% for federal taxes. If your bonus is over $1 million, they take 37% on the extra amount.
Aggregate Method happens when:
- Your bonus comes with your regular paycheck
- Everything gets combined into one payment
- Your employer treats it like normal wages
This method adds your bonus to your regular pay. Then it figures out taxes like you earn that much every paycheck.
The IRS lets employers choose either method. Most pick the percentage method because it’s easier.
Which Method Saves You More Money? (Comparison Calculator)
The aggregate method usually takes out more taxes upfront. But you might get money back at tax time.
Percentage Method (22% flat rate):
- $5,000 bonus = $1,100 in federal taxes
- $10,000 bonus = $2,200 in federal taxes
- Simple and predictable
Aggregate Method (varies by income):
- Low earners: Might pay less than 22%
- High earners: Could pay 32% or more
- Depends on your regular salary
If you earn $50,000 per year and get a $5,000 bonus, the aggregate method might take $1,600 in taxes. That’s $500 more than the percentage method.
But here’s the key: You’ll get that extra money back when you file taxes if too much was taken.
How to Request Your Preferred Withholding Method
Most employers use the percentage method automatically. But you can ask for the aggregate method if you want.
Steps to change your withholding method:
- Talk to your HR department or payroll team
- Ask them which method they currently use
- Request the method you prefer in writing
- Give them time to make the change
Email template you can use:
“Hi [HR Name],
I’d like to request that my bonus withholding use the aggregate method instead of the percentage method. This will help me manage my tax planning better.
Please let me know what information you need from me.
Thanks, [Your Name]”
Remember: The total tax you owe stays the same. These methods only change how much gets taken from your paycheck upfront.
💰 Proven Strategies to Reduce Taxes on Your NY Bonus
Getting a bonus feels great until you see the tax bill. But don’t worry – there are smart ways to keep more of your bonus money.
You can reduce your bonus taxes with simple planning. These strategies work for most New York workers who get bonuses.
Pre-Tax Retirement Contributions (401k, IRA Strategies)
Put your bonus money into retirement accounts before taxes hit. This cuts your tax bill right away.
2025 401(k) Contribution Limits:
| Age Group | Regular Limit | Catch-Up Limit | Total Possible |
|---|---|---|---|
| Under 50 | $23,500 | $0 | $23,500 |
| 50 and older | $23,500 | $7,500 | $31,000 |
Your bonus can help you reach these limits faster. Ask HR to boost your contribution percentage before bonus time.
Roth vs Traditional Choice:
- Traditional 401(k) cuts taxes now
- Roth 401(k) saves taxes later
- If your bonus puts you in a high tax bracket, choose traditional
Quick Win: Ask your HR to increase your 401(k) percentage before bonus time. This happens automatically and saves you money.
Health Savings Account (HSA) Bonus Contributions
HSAs give you triple tax savings – that’s the best deal around.
2025 HSA Contribution Limits:
| Coverage Type | Limit | Age 55+ Catch-Up |
|---|---|---|
| Individual | $4,300 | +$1,000 |
| Family | $8,550 | +$1,000 |
How It Works:
- Money goes in tax-free
- Grows tax-free
- Comes out tax-free for medical costs
Use your bonus to max out your HSA. You’ll save about 30% on taxes right away.
Timing Your Bonus Payment for Tax Optimization
When you get your bonus matters for your tax bill.
Bonus Timing Tax Impact:
| Bonus Month | Tax Year | Strategy Benefit |
|---|---|---|
| December 2025 | 2025 taxes | Pay taxes with 2025 income |
| January 2026 | 2026 taxes | Spread tax burden over two years |
Ask your employer about timing flexibility. Not all companies allow this choice.
Tax Year Planning:
- If you had a low-income year, take the bonus now
- If you had a high-income year, push it to next year
- This only works if you control the timing
Charitable Giving to Offset Bonus Tax Burden
Give to charity and cut your tax bill at the same time.
Smart Giving Tips:
- Donate appreciated stocks instead of cash
- Bunch donations into one year
- Use donor-advised funds for flexibility
Tax Savings:
- You can deduct up to 60% of your income
- Bonus pushes you into higher tax brackets
- Higher brackets = bigger deductions
Tax Savings Example:
| Income Level | Tax Bracket | $10,000 Donation Saves |
|---|---|---|
| $50,000 | 22% | $2,200 |
| $100,000 | 24% | $2,400 |
| $200,000+ | 32% | $3,200 |
Your bonus might push you into a higher bracket. This means bigger savings from donations.
Give money you were planning to donate anyway. Time it with your bonus year for maximum savings.
Real New York Bonus Tax Examples (2025 Calculations)
Let’s see exactly what you’ll take home from your bonus. These examples show real math with actual tax rates.
Remember: These are withholding amounts. Your final tax bill might be different when you file your return.
$5,000 Bonus Tax Calculation (Most Common Bonus Amount)
Here’s what happens to a $5,000 bonus in New York:
If you work in NYC:
- Federal Tax: $1,100 (22%)
- NY State Tax: $585 (11.70%)
- NYC Tax: $213 (4.25%)
- Social Security: $310 (6.2%)
- Medicare: $73 (1.45%)
- Total Taxes: $2,281
- You Take Home: $2,719
If you work outside NYC:
- Federal Tax: $1,100 (22%)
- NY State Tax: $585 (11.70%)
- Social Security: $310 (6.2%)
- Medicare: $73 (1.45%)
- Total Taxes: $2,068
- You Take Home: $2,932
You keep about $200 more if you don’t work in NYC.
$10,000 Bonus Tax Calculation (Popular Search Query)
A $10,000 bonus gets hit harder by taxes:
NYC Employee:
| Tax Type | Amount | Rate |
|---|---|---|
| Federal | $2,200 | 22% |
| NY State | $1,170 | 11.70% |
| NYC | $425 | 4.25% |
| Social Security | $620 | 6.2% |
| Medicare | $145 | 1.45% |
| Total Taken | $4,560 | 45.6% |
| You Keep | $5,440 | 54.4% |
Non-NYC Employee:
- Total Taxes: $4,135 (41.4%)
- You Take Home: $5,865
The difference between NYC and non-NYC is $425 on a $10,000 bonus.
$25,000 Bonus Tax Impact (High-Earner Scenario)
Big bonuses mean big tax bills:
NYC Resident Breakdown:
- Federal: $5,500 (22%)
- NY State: $2,925 (11.70%)
- NYC: $1,063 (4.25%)
- FICA: $1,913 (7.65%)
- Total Withholding: $11,401
- Net Amount: $13,599
You lose about 46% to taxes right away. But here’s the thing: if you’re in a lower tax bracket normally, you might get some back at tax time.
Tax Planning Tip: Consider asking your employer to spread large bonuses across two tax years. This might lower your overall tax burden.
$100,000+ Executive Bonus Tax Planning
Executive bonuses over $100,000 face serious tax hits:
$100,000 Bonus in NYC:
- Federal: $22,000 (22%)
- NY State: $11,700 (11.70%)
- NYC: $4,250 (4.25%)
- FICA: $7,650 (7.65%)
- Total Withheld: $45,600
- Take Home: $54,400
Smart Moves for Large Bonuses:
- Talk to a tax pro before bonus time
- Consider retirement account contributions
- Look into deferred compensation plans
- Plan for estimated tax payments
Million Dollar Bonus Alert: If your bonus hits $1 million, the federal rate jumps to 37%. That’s an extra $150,000 in federal taxes alone.
Remember: These calculations show what gets taken out of your paycheck. Your actual tax bill depends on your total income, deductions, and filing status.
FICA Taxes on New York Bonuses (Easy Guide)
When you get a bonus, most people think about income tax. But FICA taxes also take money from your bonus.
FICA stands for the Federal Insurance Contributions Act. It includes two things:
- Social Security tax
- Medicare tax
Your bonus gets taxed just like your regular paycheck.
Let’s look at how these taxes work.
Social Security Tax on Bonuses (6.2% Up to a Limit)
You pay 6.2% Social Security tax on your income, including bonuses. But only up to a certain amount.
In 2025, the limit is $176,100. This includes both your salary and bonus.
Example 1:
You earn $50,000 and get a $10,000 bonus:
- Total: $60,000
- Social Security tax: 6.2% of $60,000 = $3,720
- Tax on bonus alone: $620
Example 2:
You earn $170,000 and get a $10,000 bonus:
- Total: $180,000 (over the $176,100 limit)
- Social Security tax stops at $176,100
- Tax on bonus: only $378.20
Good news: If you already passed $176,100 before your bonus, you don’t pay Social Security tax on it.
Medicare Tax on Bonuses (1.45% + 0.9% for High Earners)
You always pay Medicare tax — no income limit.
- Regular Medicare tax: 1.45%
- Extra tax: 0.9% if you make a lot of money
The extra 0.9% starts if you earn:
- $200,000 (single)
- $250,000 (married filing jointly)
- $125,000 (married filing separately)
Example 1:
You earn $80,000 and get a $5,000 bonus:
- Medicare tax: 1.45% of $5,000 = $72.50
Example 2:
You earn $190,000 and get a $20,000 bonus:
- Total income: $210,000
- First $200,000: 1.45% = $290
- Last $10,000: 0.9% extra = $90
- Total Medicare tax: $380
Heads-up: Your employer might not take out the 0.9% extra. You might pay it later when you file taxes.
Quick 2025 FICA Tax Facts
Social Security Tax:
- Rate: 6.2%
- Limit: $176,100
- Max tax: $10,918.20
Medicare Tax:
- Regular: 1.45% (no limit)
- Extra 0.9% after:
$200,000 (single)
$250,000 (married, joint)
$125,000 (married, separate)
What This Means for Your Bonus
- If your total pay is close to $176,100, your bonus might push you over. The extra part won’t get Social Security tax.
- If your total pay is near $200,000, your bonus might trigger the 0.9% Medicare tax.
Tip: Check your total income before your bonus hits. You might save some money, or owe a little more in taxes.
The bright side: These taxes go toward your future retirement and health care (Social Security and Medicare).
New York vs Other States: Bonus Tax Comparison
New York taxes your bonus pretty hard compared to other states. But you’re not alone – some states hit even harder.
Here’s what you need to know about NY versus other places.
Why New York Bonus Taxes Are High?
New York has a supplemental tax rate for bonuses. This means your bonus gets taxed differently from your regular pay.
Your bonus faces both federal and state taxes. The federal rate is 22% for most bonuses. Then New York adds its own rate on top.
But here’s the thing – it’s not the worst out there.
States That Tax Bonuses More Than New York
Some states actually charge more than New York for bonus taxes:
- California: Higher overall tax burden
- Hawaii: Top marginal rates above 10%
- New Jersey: Similar high rates
- Vermont: Progressive rates up to 7.65%
These states can take a bigger bite from your bonus check.
Highest vs Lowest Bonus Tax States (2025 Rankings)
Highest Bonus Tax States:
| State | State Bonus Tax Rate | Total with Federal (22%) |
|---|---|---|
| California | Up to 13.3% | Up to 35.3% |
| Hawaii | Up to 11% | Up to 33% |
| New York | Up to 10.9% | Up to 32.9% |
| New Jersey | Up to 10.75% | Up to 32.75% |
| Vermont | Up to 7.65% | Up to 29.65% |
Zero Bonus Tax States:
| State | State Tax | Federal Tax | Total Tax |
|---|---|---|---|
| Alaska | 0% | 22% | 22% |
| Florida | 0% | 22% | 22% |
| Nevada | 0% | 22% | 22% |
| South Dakota | 0% | 22% | 22% |
| Tennessee | 0% | 22% | 22% |
| Texas | 0% | 22% | 22% |
| Washington | 0% | 22% | 22% |
| Wyoming | 0% | 22% | 22% |