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California Bonus Tax Calculator

Bonuses, commissions, RSU sell-to-cover, and other supplemental wages are withheld differently from regular paychecks. This calculator shows exactly how much of your bonus you keep after California-specific supplemental withholding for 2026.

California Bonus Tax Calculator

California taxes bonuses and other supplemental wages at a flat 10.23% (employer withholding rate). Federal supplemental withholding is 22% up to $1M.

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Used to estimate Social Security cap and Additional Medicare exposure.

Withholding method

The percentage method is the most common — it applies a flat 22% federal + 10.23% CA. The aggregate method combines the bonus with your regular paycheck and uses your normal tax tables.

Estimated bonus take-home

$5,892

from $10,000 bonus — withheld at 41.1%

Withholding breakdown

  • Federal$2,200.00
  • California (10.23%)$1,023.00
  • Social Security$620.00
  • Medicare + Additional$145.00
  • CA SDI$120.00
  • Total withheld$4,108.00

Withholding is not the same as your final tax. If too much is withheld you receive a refund at tax time.

Why your bonus check looks so much smaller than expected

The most common surprise on a California paycheck is the bonus check. A $10,000 bonus often arrives as roughly $6,000. That isn't because the bonus is taxed at a higher rate — it's because employers withhold supplemental wages at flat federal and California rates that are typically higher than your regular paycheck withholding.

The good news: withholding is not the same as your final tax bill. If too much was withheld on your bonus, you get the difference back at tax time as a refund.

The two methods California employers use

1. Percentage method (most common)

The IRS allows employers to withhold a flat 22% federal on supplemental wages up to $1 million per year. Wages above $1 million are withheld at 37%. California separately withholds a flat 10.23% on bonuses and stock options, and 6.6% on other supplemental wages. Add 7.65% FICA + 1.2% SDI, and the total withholding on a typical bonus comes to ~41% — much higher than the actual marginal rate at most income levels.

2. Aggregate method

Some employers combine your bonus with your regular paycheck and withhold based on the combined gross. This usually results in lower total withholding for mid-income earners (because their normal marginal rate is below the flat 22%/10.23%) but higher withholding for very high earners.

What you actually owe vs. what gets withheld

Your bonus is taxed at your normal marginal rate. If your regular salary already puts you in the 24% federal + 9.3% California bracket, your bonus is also taxed at 24% + 9.3% + payroll. The percentage method usually over-withholds by 5–10 percentage points for middle-income earners — that\'s where refunds come from.

Common situations

  • End-of-year bonus, mid-income earner: Percentage method over-withholds. Expect a refund or smaller balance owed at filing.
  • Sign-on bonus, $200k+ earner: Percentage method may under-withhold because your true marginal rate is above 22%. Plan for additional tax owed.
  • RSU vesting (sell-to-cover): Most employers withhold at the federal 22% supplemental rate. If your marginal is higher, you\'ll owe at year-end. Consider increasing W-4 withholding.
  • Bonus over $1M: The portion above $1M is withheld at 37% federal + 10.23% California — so the total federal+state withholding alone exceeds 47%.

How to plan for tax time

If you know a large bonus is coming, model both your regular paycheck and the bonus combined to see your true marginal exposure. If your withholding looks low, consider:

  • Increasing extra federal/state withholding on your W-4 / DE 4 for the year.
  • Making a Q4 estimated tax payment to avoid underpayment penalties.
  • Using a portion of the bonus to max out 401(k) or HSA contributions before year-end.

Frequently asked questions

Are bonuses taxed at a higher rate in California?
No — your final tax owed on a bonus is the same as on regular wages. But California withholds bonuses at a flat 10.23% (10.23% on bonuses and stock options, 6.6% on other supplemental wages) and federal withholds at a flat 22% (37% above $1M). For most middle-income earners, this over-withholds and produces a refund.
What is the California supplemental tax rate for 2026?
California's supplemental withholding rate is 10.23% on bonuses and stock options, and 6.6% on other supplemental wages — the rates set by the FTB. These rates are the employer withholding rates, not the employee's actual tax rate.
Why was so much taken out of my bonus check?
Supplemental wages are withheld at flat rates: 22% federal + 10.23% California + 7.65% FICA + 1.2% SDI = roughly 41% gross withholding. Your true tax rate is usually lower, so the excess comes back at tax time.
How are RSU vests taxed in California?
RSUs vest as ordinary income. California treats RSU income identically to regular W-2 wages. The default sell-to-cover withholding uses the supplemental rate (22% federal + 10.23% California), which often under-withholds for high earners — plan accordingly.
Can I lower the tax on my bonus?
You can't change the tax rate, but you can effectively defer the bonus into pre-tax accounts: increase your 401(k) contribution percentage just before the bonus pay period, or use the bonus to fund an HSA or pre-tax health savings. Each pre-tax dollar saves your full marginal rate, often 30–40% in California.

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