# Methodology: How Our Paycheck and Bonus Numbers Are Calculated

Canonical: https://takehomepaytools.com/methodology/
Last updated: 2026-10-31

Every number on this site comes from one calculation engine that implements the official IRS formulas.

## Federal income tax withholding

We follow IRS Publication 15-T Worksheet 1A, the percentage method for automated payroll systems with a 2020 or later Form W-4. Pay is annualized, adjusted for W-4 Steps 2, 3 and 4, run through the annual withholding table for the filing status, and divided back to one pay period. Married filing separately uses the single table, as the IRS specifies.

## Bonuses

The flat method applies the IRS supplemental rate to the bonus. The aggregate method (IRS method 1b) adds the bonus to one regular paycheck, calculates withholding on the total, and subtracts the withholding on the regular paycheck alone. Supplemental wages above the annual threshold for mandatory withholding use the mandatory rate under both methods.

## Social Security and Medicare

Social Security stops once wages for the year reach the annual wage base. Medicare has no limit. Additional Medicare Tax is withheld only on wages above the annual threshold, starting with the paycheck that crosses it. Traditional 401(k) deferrals reduce federal income tax wages but not Social Security or Medicare wages.

## Rounding

Intermediate annual figures are not rounded. Each withholding line for a paycheck is rounded to the nearest cent. The IRS also allows employers to round to whole dollars, so a pay stub can differ by up to a dollar per line.

## How we test the numbers

Every table value is extracted by script from the official IRS publication, never typed by hand, and the extraction checks that each bracket follows from the one before. The engine is then tested against every row of the IRS wage bracket tables in Pub 15-T for every pay frequency and filing status, plus the worked examples in Pub 15. A change to any tax table must update the source list in the same commit, or the build fails.

## Withholding is not your final tax

These calculators estimate what an employer withholds. Your actual tax for the year is settled on your return and depends on your full income, deductions and credits.

## Sources and last verified dates

### Tax year 2026

| Figures | Source | Last verified |
| --- | --- | --- |
| Federal income tax withholding tables (Worksheet 1A, percentage method) | [IRS Publication 15-T (2026), Federal Income Tax Withholding Methods](https://www.irs.gov/publications/p15t) | 2026-10-31 |
| Social Security, Medicare and Additional Medicare rates and limits | [IRS Publication 15 (2026), (Circular E), Employer's Tax Guide](https://www.irs.gov/publications/p15) | 2026-10-31 |
| Supplemental wage (bonus) withholding rates | [IRS Publication 15 (2026), (Circular E), Employer's Tax Guide, section 7 Supplemental Wages](https://www.irs.gov/publications/p15) | 2026-10-31 |

## Changelog

- 2026-10-31: Launched the bonus tax calculator with 2026 federal withholding (IRS Pub 15-T), Social Security and Medicare (IRS Pub 15).