The North Dakota bonus tax calculator at the top of this page helps employers quickly estimate employee take-home pay (also known as net pay) for bonuses. When applicable, it uses the state’s optional 1.5% flat rate for supplemental wages paid separately.
Behind the numbers
Behind the numbers
Updated: June 25, 2025
Does North Dakota tax bonuses?
Yes. North Dakota treats bonuses as taxable income and follows federal guidance for how supplemental wages should be withheld. The state allows two primary options for calculating withholding on bonuses and other supplemental wages (like commissions, overtime, or severance pay), depending on how the payment is made:
- If the bonus is paid separately — or clearly listed as a separate amount in a combined paycheck — employers can:
- Withhold a flat 1.5%, or
- Add the bonus to the employee’s most recent regular wages, calculate withholding on the total, and subtract what was already withheld from the regular wages.
If the bonus is combined with regular wages and not itemized, employers must use North Dakota’s standard percentage method or wage bracket tables to calculate withholding on the full amount. Keep in mind that vacation pay paid in addition to regular wages is also treated as supplemental wages.
What counts as supplemental wages in North Dakota?
In addition to bonus pay, these types of wages include commissions, overtime pay, payments for accumulated sick leave, severance pay, awards, prizes, taxable fringe benefits, and even back pay.
How do bonuses work in North Dakota?
Bonuses are treated as part of taxable wages. Employers must withhold appropriately using either the flat or aggregate method and report the payment on the employee’s Form W-2.
How to calculate bonus tax in North Dakota
Bonuses should be aggregated with regular wages and taxed using the standard state withholding tables.
How much tax is taken out of a bonus in North Dakota?
- Federal: 22%
- State: Up to 2.5%, or 1.5% flat for separate supplemental payments
- Combined: Up to 24.5%, plus FICA and other deductions
Why are bonuses taxed differently than standard pay?
They aren’t always — but if the bonus is paid separately, employers may use a flat 1.5% withholding rate rather than the standard tax tables.
How can employers in North Dakota pay bonuses to employees?
Bonuses can be paid via:
- Check
- Direct deposit
- Pay card