The Maryland bonus tax calculator at the top of this page helps employers quickly estimate employee take-home pay (also known as net pay) for bonuses.
Behind the numbers
Behind the numbers
Updated: June 29, 2025
Does Maryland tax bonuses?
Yes. In Maryland, bonuses are taxed the same as regular wages. Employers must also apply local tax rates based on the employee’s county of residence. Commissions and other supplemental wages are treated as regular income for withholding purposes.
How to calculate bonus tax in Maryland
Add the bonus to the employee’s regular wages and use Maryland’s tax tables for both state and local rates (which is how the bonus calculator above crunches the numbers). Maryland does allow for a supplemental rate when figuring this out.
What is the bonus tax rate in Maryland?
Maryland has a progressive state income tax rate from 2% to 5.75%, plus local rates ranging from 2.25% to 3.2%. The takeaway is that combined rates may exceed 8.95%.
How can employers in Maryland pay bonuses to employees?
Bonuses can be paid via:
- Check
- Direct deposit
- Pay card
How do bonuses work in Maryland?
Employers must withhold both state and local taxes based on the employee’s residence and report bonuses as wages on Form W-2.
Why are bonuses taxed differently than standard pay?
They’re not — all compensation is subject to the same withholding structure unless paid to nonresidents with special rules.
How much tax is taken out of a bonus in Maryland?
- Federal: 22%
- State + Local: up to 8.95%
- Combined: as much as 30.95%