The Idaho bonus tax calculator at the top of this page helps employers quickly estimate the net (take-home) pay employees should receive for bonus payments, using the state’s flat income tax rate.
Behind the numbers
Behind the numbers
Updated: June 27, 2025
Does the state of Idaho tax bonuses?
Yes. Idaho treats bonuses as supplemental wages and includes them in gross income for withholding purposes. According to the Idaho State Tax Commission, supplemental wages also include commissions, overtime pay payments for accumulated sick leave, severance pay, awards or prizes, back pay, and retroactive pay, and other similar payment types.
How to calculate bonus tax in Idaho
Idaho does not have a unique supplemental tax rate for bonuses. However, for separately paid bonuses, employers may withhold using the flat state income tax rate of 5.3% (effective January 1, 2025). Otherwise, aggregate the bonus with regular wages and apply the standard withholding tables.
What is the bonus tax rate in Idaho?
The current Idaho income tax rate of 5.3% (down from 5.695%) is a result of House Bill 40, which Governor Brad Little signed into law on March 6, 2025. The change is retroactive to January 1, 2025, and represents the largest income tax cut in state history.At the federal level, the bonus tax rate is 22% for bonuses under $1 million.
How can employers in Idaho pay bonuses to employees?
Bonuses can be paid via:
- Check
- Direct deposit
- Pay card
How much tax is taken out of a bonus in Idaho?
- Federal: 22%.
- State: 5.3%.
- Combined: 27.3%, plus other payroll taxes
Why are bonuses taxed differently than standard pay?
Idaho doesn’t treat them differently — they’re taxed the same as regular wages unless reported separately.
How do bonuses work in Idaho?
Bonuses are included in total compensation and reported on the employee’s W-2. If paid separately, they must be clearly identified on the pay stub.