Bonus Tax in Georgia: How Bonuses Are Withheld in 2026

Tax year 2026 · Last updated September 25, 2026 · Sources listed at the end

A bonus is withheld differently from a regular paycheck: a flat 22% federal rate is common, Georgia takes its 4.99% flat rate, and Social Security and Medicare apply as usual. Here is what comes out of a Georgia bonus in 2026 and why.

A $5,000 bonus in Georgia, step by step

When a bonus is paid separately from regular wages, most employers use the federal flat rate. For a $5,000 bonus paid after May 11, 2026, to someone below the Social Security wage base:

That is 65.4% of the bonus. If you are already above the $184,500 Social Security wage base for the year, the 6.2% does not apply, and a $10,000 bonus would net about $7,156.00 (before any Additional Medicare Tax, which applies to wages over $200,000).

Federal rules for supplemental wages

The IRS calls bonuses, commissions, overtime paid separately, severance and similar payments “supplemental wages.” For 2026, Publication 15 gives employers these options (IRS Publication 15, section 7):

• Flat rate: 22%. Allowed if the bonus is identified separately from regular wages and income tax was withheld from your regular wages this year or last year. No other percentage is allowed, and your W-4 is ignored.
• Aggregate method. The bonus is added to a regular paycheck and withholding is figured on the total as if it were a normal paycheck, minus what was withheld from the regular wages. Because payroll annualizes the combined amount, this can withhold more than 22%.
• Mandatory 37% on the part of supplemental wages above $1 million paid to one employee in a calendar year, regardless of the W-4.
• If a bonus is lumped into a regular paycheck with no split shown, it is withheld as one regular payment.

Example of the aggregate method. A single filer earning $60,000 paid biweekly normally has $193.08 of federal tax withheld. If a $5,000 bonus is added to one paycheck, the combined $7,307.69 is annualized to about $190,000, and withholding on that paycheck becomes $1,320.54. The extra $1,127.46 is 22.5% of the bonus, compared with 22% under the flat method. Neither is your final tax; both are prepayments reconciled on your return.

Georgia's rule for bonuses

Georgia does not have a separate supplemental rate. The DOR's 2026 guide says bonuses and other compensation are withheld at the income tax rate in effect when they are paid: 5.19% before the rate change took effect, and 4.99% from May 11, 2026 (O.C.G.A. § 48-7-101(f)(5); DOR Employer’s Withholding Tax Guide 2026). No standard deduction is subtracted from a separately paid bonus, so Georgia withholding is simply 4.99% of the bonus.

Why bonuses feel over-taxed

A bonus is taxed at the same rates as salary in the end. The flat 22% can be more or less than your real marginal rate: a single filer earning $60,000 is in the 12% federal bracket, so 22% withholding on a bonus overshoots, and the difference comes back as a smaller balance due or a larger refund. A high earner in the 32% or 35% bracket is under-withheld at 22% and may owe more at filing. If that is you, add extra withholding in Step 4(c) of your W-4 or increase your estimated payments.

Reducing tax on a bonus

• Ask whether you can direct part of the bonus into your traditional 401(k). Deferrals reduce federal and Georgia income tax (not FICA), up to the 2026 limit of $24,500 across the year (IRS Notice 2025-67).
• The timing of a bonus within the year does not change the rate it is taxed at on your return, except for Social Security, which stops once you pass the wage base.

Sources

1. IRS Publication 15 (2026), Employer’s Tax Guide (Circular E)
2. Georgia Department of Revenue, Employer’s Withholding Tax Guide 2026 (revised June 2026)
3. IRS Notice 2025-67 (2026 retirement plan limits)

This guide explains general rules for estimating paycheck withholding. It is not tax or legal advice. See our disclaimer.