The Pennsylvania 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: July 11, 2025
Does Pennsylvania tax bonuses?
Yes. Pennsylvania taxes all compensation, including bonuses, at a flat rate.
How to calculate bonus tax in Pennsylvania
Apply the state’s flat withholding rate of 3.07% to the bonus, along with local earned income tax if applicable. or if supplemental compensation such as commissions or bonuses is paid to employees, the employer determines the tax to be withheld by adding the supplemental amount for the payroll period and multiplying it by the current tax rate.
What is the bonus tax rate in Pennsylvania?
- 3.07% state + local tax (which varies by jurisdiction) + 22% federal taxes
- Total: Approximately 25% to 28%, depending on where the employee lives or works
How can employers in Pennsylvania pay bonuses to employees?
Bonuses in Pennsylvania can be paid via:
- Check
- Direct deposit
- Pay card
How do bonuses work in Pennsylvania?
Bonuses are fully taxable and must be reported on W-2s, with standard state and local withholding.
How much tax is taken out of a bonus in Pennsylvania?
Bonuses in Pennsylvania are typically taxed at:
- 3.07% for state income tax
- 22% for federal withholding
- Plus local income tax, which varies by location
The takeaway? It means that around 25% to 28% of a bonus might be withheld for taxes, depending on where the employee lives or works.
Why are bonuses taxed differently than standard pay?
They aren’t — Pennsylvania applies the same flat rate across all wage types.