Bonus tax calculator New York
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Does New York state tax bonuses?

Yes. New York taxes supplemental wages — including bonuses, commissions, sales awards, and overtime — as regular income. If supplemental wages are paid at the same time as regular wages and the amounts aren’t separately identified, employers must calculate withholding as if the total amount were a single wage payment for the period.

How to calculate bonus tax in New York state

If supplemental wages are paid separately (or separately identified within the same payment), the method of withholding depends on whether income tax is also withheld from the employee’s regular wages:

• Option 1: Withhold at the New York State supplemental rate of 11.70% (.1170).
• Option 2: Combine the supplemental and regular wages for the most recent payroll period this year. Calculate withholding on the total as if it were a single payment, then subtract the amount already withheld from the regular wages. From here, withhold the remainder from the supplemental wages.
• If no income tax was withheld from the employee’s regular wages, use Option 2.

Vacation pay paid in addition to regular wages for the same period is treated as a supplemental wage. You can also refer to IRS Publication 15 (Circular E) for more on what counts as supplemental wages. If the employee resides in New York City or Yonkers, additional local tax withholding applies.

What are the bonus tax rates in New York?

• New York State supplemental rate: 11.70%
• NYC supplemental rate: 4.25%
• Yonkers Resident: 1.95975%
• Yonkers Nonresident: 0.50%

How do bonuses work in New York?

Bonuses are reported on Form W-2 and are subject to both state and local income taxes.

How can employers in New York pay bonuses to employees?
Bonuses can be paid via:

• Check
• Direct deposit
• Pay card

Why are bonuses taxed differently than standard pay?
They aren’t — unless the employee lives in NYC or Yonkers, in which case additional local tax applies.

In New York City, you’d use a supplemental rate of 4.25% (.0425)

In Yonkers, you would withhold at the following supplemental rates:

• Yonkers Resident 1.95975% (.0195975)
• Yonkers Nonresident 0.50%

How much tax is withheld from a bonus in New York?

• Federal: 22%
• State + Local (up to): approximately 14.8%
• Combined (up to): approximately 36.8%, plus FICA

More resources for New York employers

• New York state withholding tables and methods
• New York City state withholding tables and methods
• Yonkers withholding tables and methods
• Additional information on withholding tax