Bonus Tax Gross-Up Calculator

About this calculator

A tax gross-up calculates the larger gross bonus an employer must pay so that, after taxes are withheld, the employee actually receives a specific target net amount. The formula is gross = net ÷ (1 − combined tax rate), where the combined tax rate bundles together federal, state, and payroll taxes, like Social Security and Medicare, that apply to supplemental wages.

Payroll and HR teams use gross-ups when a company wants to guarantee an employee a specific take-home bonus — a common promise in relocation packages, signing bonuses, or negotiated compensation — rather than leaving the final net amount to vary with the employee's exact tax situation. It shifts the tax burden of hitting that guarantee onto the employer's payroll cost rather than the employee's paycheck, so accurately calculating the gross amount matters for both budgeting and correct tax withholding.