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Pay an employee bonus

SOLVEDby QuickBooksIntuit Online Payroll1958Updated March 07, 2022

Learn how to pay an employee bonus using QuickBooks and Intuit Online Payroll.

Bonuses are fun to pay out for a job well done. Compliment your employees by giving them bonuses. We’ll show you how to pay bonuses in your payroll product.

Step 1: Determine how you want to pay out the bonus

You can pay your employees with bonuses along with their regular pay or through a separate paycheck.

Pay bonus along with the regular pay

  • If you pay bonuses along with the employee’s regular pay, the bonus amount is taxed the same way as the employee’s salary.
  • Any deductions set as percentages will come out of the bonus.  

Pay a separate bonus check

If you pay bonuses separate from the employee’s salary:

  • You can apply the federal supplemental tax rate of 22%, or 37% for bonuses $1,000,000 or more.
  • You have the option to pay the bonus as a gross pay or as a net pay. For the net pay example, if you want your employee to take home $1000, the payroll product will gross this up and you’ll pay the employee part of taxes.  
  • Your employee can only have the bonus go to one direct deposit account.

Step 2: Add the Bonus pay type

If you choose to pay a bonus along with the employee’s regular pay, add the Bonus pay type before you run payroll. If you choose to give the bonus through a separate check, skip to Step 3: Payout the bonus.

Follow the steps below for your payroll product.

Note: Not sure which payroll service you have? Here's how to find your payroll service.
  1. Select the Payroll menu, then Employees.
  2. Select the employee's name.
  3. In the Pay types section, select Edit.
  4. In the Common pay types section, select Bonus .
  5. Select Save.
  1. Go to Employees.
  2. Select the employee's name.
  3. In the Pay section, select Edit.
  4. In the What additional ways do you pay employee? section, select Bonus.
  5. Select OK to save the changes.

Step 3: Pay out the bonus

Pay bonus along with the employee's salary

  1. Select the Payroll menu, then Employees.
  2. Select Run payroll.
  3. Select the employee. Then enter the amount in the Bonus field.
  4. Select Preview payroll, then Submit payroll.
  1. Go to Payday.
  2. Select a pay schedule if applicable.
  3. Select the employee. Then enter the amount in the Bonus field.
  4. Create and approve the payroll.

Pay a bonus-only paycheck

Note: If you enter the bonus amount “As net pay”, you don’t have the option to deduct retirement, HSA, or garnishments.

  1. Select the Payroll menu, then Employees.
  2. From the Run payroll ▼ dropdown, select Bonus only.
  3. Choose how you’d like to enter the bonus as:
    1. As a net: The employee gets the exact bonus amount. Taxes are still calculated but it’ll be an company-paid tax.
    2. As a gross: We’ll figure out the net amount for you.
  4. Select the employee, then enter the Bonus amount.
  5. Select Edit ✎ next to "Payroll options".
  6. Select the payroll options you want . Then select Apply.
  7. Select preview and submit payroll.
  8. If you’ve selected As net pay, the pay stub includes Employee Taxes Paid by Employer in the pay section.

Note: You can't use net-to-gross together with any deductions (retirement, HSA, or garnishments).

  1. Go to Payday.
  2. Select a pay schedule if applicable.
  3. In the Check Type ▼ dropdown, select Bonus Checks.
  4. Select Go to proceed.
  5. Select the applicable settings for the bonus paycheck.
  6. Select the employee, then enter the bonus amount.
  7. Create and approve the paycheck.
  8. If you select net-to-gross calculation from the Settings, the pay stub will list Employee Taxes Paid by Employer in the pay section.
  1. Select Payday. Then select Bonus.
  2. Select a Pay Schedule if applicable. Then select the Pay method.
  3. Select the applicable settings for the bonus check. Then select Next.
  4. Select the employee, then enter the amount.
  5. Create and send the paycheck.
  6. If the pay method is paper check, Print the check.

 

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