Article
2-minute read
Supplemental Tax Rates by State (2024)
US payroll
PEO
Author
Shannon Ongaro
Published
July 30, 2024
Last Update
November 20, 2024
Key takeaways
- Due to their nature as additional income, supplemental wages are subject to specific tax rates, both at the federal and state level.
- While the federal supplemental tax rate is a flat 22%, states have different approaches, with some imposing specific rates, others applying regular income tax rates, and some having no provisions for supplemental wages at all.
- Given the varying state regulations, ensuring accurate tax withholdings and payments can be challenging for employers. Using a payroll management solution like Deel US Payroll can help streamline this process.
Supplemental pay, also known as supplemental wages, is additional income an employee receives on top of their regular monthly wages or salary.
Since supplemental wages differ from regular wages in regard to payment dynamics, the tax rate applied also differs. The federal supplemental tax rate is a flat 22%, but states may have their own rates or provisions.
Here's a look at supplemental tax rates by state (2024):
| State | Supplemental Wage Rate |
|---|---|
| Alabama | 5% |
| Alaska | No supplemental wage rates |
| Arizona | No provision for supplemental wage rates |
| Arkansas | 4.70% |
| California | 6.60% |
| Colorado | 4.40% |
| Connecticut | No provision for supplemental wage rates |
| Delaware | No provision for supplemental wage rates |
| Florida | None |
| Georgia | 2% to 5.75% depending on annual income |
| Hawaii | No provision for supplemental wage rates |
| Idaho | 6% |
| Illinois | 4.95% |
| Indiana | 3.23% |
| Iowa | 6% |
| Kansas | 5% |
| Kentucky | 4.50% |
| Louisiana | No provision for supplemental wage rates |
| Maine | 5% |
| Maryland | 5.75% plus the county rate |
| Massachusetts | 5% |
| Michigan | 4.05% |
| Minnesota | 6.25% |
| Mississippi | No provision for supplemental wage rates |
| Missouri | 4.95% |
| Montana | 6% |
| Nebraska | 5% |
| Nevada | No supplemental wage rates |
| New Hampshire | No supplemental wage rates |
| New Jersey | No provision for supplemental wage rates |
| New Mexico | 5.90% |
| New York | 11.70% |
| North Carolina | 4.85% |
| North Dakota | 1.84% |
| Ohio | 3.50% |
| Oklahoma | 4.75% |
| Oregon | 8% |
| Pennsylvania | 3.07% |
| Rhode Island | 5.99% |
| South Carolina | 6.50% |
| South Dakota | No supplemental wage rates |
| Tennessee | No supplemental wage rates |
| Texas | No supplemental wage rates |
| Utah | No supplemental wage rates |
| Vermont | 30% of the federal tax |
| Virginia | 5.75% |
| Washington | No supplemental wage rates |
| West Virginia | 3% to 6.5% |
| Wisconsin | 3.54%, 4.65%, 5.3%, or 7.65% |
| Wyoming | No supplemental wage rates |
Disclaimer: This article is provided for general informational purposes and should not be treated as legal or tax advice. Rates are accurate at the time of publishing. Consult a professional before proceeding.
Platform Tour
Let Deel manage US payroll compliance for you
Deel offers a comprehensive solution for managing US and international payroll, including payments, taxes, worker classification, and more.
Employers can leave state-by-state compliance to experts by using Deel US Payroll or Deel PEO to handle HR, payroll, and compliance efficiently. To streamline your payroll processes and ensure compliance, book a demo with Deel today.
About the author
Shannon Ongaro is a content marketing manager and trained journalist with over a decade of experience producing content that supports franchisees, small businesses, and global enterprises. Over the years, she’s covered topics such as payroll, HR tech, workplace culture, and more. At Deel, Shannon specializes in thought leadership and global payroll content.
