Does ferderal income tax go up if an employee gets a separate bonus check

Yes, if the bonus check is separate from their regular wage. Per the IRS Supplemental Wages guidelines, payroll needs to withhold a flat 25% (no other percentage allowed). They are also subject to social security, Medicare, and FUTA taxes.

Refer to Publication 15, table 7 for Supplemental Wages.


 

QuickBooks Pro 2017 and QuickBooks Premier 2017 - Buy Now and Save!
TRY QUICKBOOKS ONLINE (QBO) FOR FREE
TRY XERO ACCOUNTING FOR FREE