A bonus paid to an Oregon worker is typically hit with about 37% to 40% in combined tax withholding before it lands in your account. On a $10,000 bonus outside the Portland metro area, that works out to roughly $6,225 in take-home pay. Portland-area workers above certain income thresholds take home less because of additional local taxes. If you’re asking how much bonuses are taxed in Oregon, the short answer is that four layers of withholding apply: 22% federal, 8% Oregon state, 7.65% in Social Security and Medicare, and a small statewide transit tax.
The Four Layers of Withholding
The IRS classifies bonuses as “supplemental wages.” Most employers withhold federal income tax on them at a flat 22% rate, no matter what your Form W-4 says. That flat rate covers every dollar of bonus up to $1 million in a calendar year; anything above that from a single employer is withheld at 37%.1Internal Revenue Service. Publication 15 (2026), Employer’s Tax Guide
Oregon requires employers to withhold state income tax from bonuses at a flat 8%.2Oregon Department of Revenue. Oregon Withholding Tax Tables 2026 That rate applies to the gross bonus and runs independently of the federal deduction.
FICA taxes come out of every bonus. Social Security takes 6.2% and Medicare takes 1.45%, for a combined 7.65%.3Internal Revenue Service. Publication 15-A (2026), Employer’s Supplemental Tax Guide Social Security only applies to earnings up to the annual wage base, which is $184,500 for 2026.4Social Security Administration. Contribution and Benefit Base If your year-to-date wages have already passed that cap, the 6.2% stops on the amount above it. Medicare has no cap, and an extra 0.9% kicks in on wages above $200,000 for a single filer.
Oregon also levies a statewide transit tax on wages, including bonuses. The rate is 0.1%, rising to 0.2% beginning January 1, 2026.5Oregon Department of Revenue. Statewide Transit Tax It’s a small line item, but it reduces your net pay.
What a $10,000 Bonus Actually Looks Like
For a typical Oregon worker outside the Portland metro area, here is how a $10,000 bonus breaks down under the flat withholding methods:
- Federal income tax at 22%: $2,200
- Oregon state income tax at 8%: $800
- Social Security at 6.2%: $620
- Medicare at 1.45%: $145
- Statewide transit tax at 0.1%: $10
- Total withheld: $3,775
- Net pay: about $6,225
If You Live or Work in the Portland Metro Area
Two local income taxes can take an additional bite. They don’t apply to every Oregon worker, only to those above specific income thresholds in the Portland metro area.
The Metro Supportive Housing Services (SHS) tax funds homelessness services. For 2026, it is 1% on taxable income above $128,000 for single filers and $205,000 for joint filers.6Portland.gov. Personal Income Tax Filing and Payment Information When an employer determines you’re subject to Metro withholding, supplemental payments like bonuses are withheld at the flat 1%.7Metro. Metro Supportive Housing Services Income Tax Employer Handbook 2026
The Multnomah County Preschool for All (PFA) tax hits residents and workers in that county. Single filers pay 1.5% on income above $125,000, and 3% total on income above $250,000. For joint filers, the 1.5% rate starts above $200,000 and the 3% rate above $400,000.8Multnomah County. Multnomah County Preschool For All Personal Income Tax Employer withholding rules for PFA on supplemental wages are less clearly defined than the Metro SHS rules. Some employers withhold it, others don’t, so you may owe PFA at filing time rather than seeing it deducted from the check.
Adding a 1% Metro SHS withholding ($100) and a 1.5% PFA withholding ($150) to the earlier $10,000 example brings total deductions to roughly $4,025 and net pay to about $5,975. Higher earners who trigger the additional 0.9% Medicare tax or the 3% PFA rate see even less.
Why Your Final Tax Bill May Not Match the Withholding
The flat rates on your bonus are prepayments, not final figures. Your actual liability depends on your total income, filing status, deductions, and credits for the year. A few common situations create a gap:
- Lower earners whose total income puts them in a federal bracket below 22% or an Oregon bracket below 8% had too much withheld and get the excess back as a refund.
- Higher earners in Oregon’s top 9.9% bracket, or a federal bracket above 22%, didn’t have enough withheld and will owe the difference.
- If your year-to-date wages are near the $184,500 Social Security cap when the bonus hits, part or all of the bonus may be exempt from the 6.2% deduction.4Social Security Administration. Contribution and Benefit Base
- If your income hovers near the Metro SHS or PFA thresholds, your employer may withhold the local tax when you don’t actually owe it, or skip it when you do.
If the Withholding Looks Off, Adjust It
The Oregon Department of Revenue offers a withholding calculator that can tell you whether your overall withholding is on track after a bonus.9Oregon Department of Revenue. Do a Paycheck Checkup With the Oregon Withholding Calculator If too much is coming out, you can file a new Oregon Form OR-W-4 to reduce withholding on future paychecks. If too little is coming out, an estimated tax payment can keep you from owing a lump sum at filing time.