How to calculate tax on a "commission" check?

1. If you work for a company, an private person, a non-profit organization, etc., the government does not calculate the amount withheld. The amount withheld is calculated by the employer (or a payroll service, such as ADP). The government only calculates the amount to withhold if the person is being paid by the government (in other words, only for the government's employees).

2. The correct total percent depends on the state in which the person works and on the amount of the check. For example, for a person working in New York City and receiving a very large check, the tax withheld could be:

FICA, social security and medicare: 7.65% (might be listed as two taxes, one 6.2% and one 1.45%)

Federal income tax: up to approximately 35%

State income tax: 6.85%

City income tax: 4%

Total: up to approximately 53-1/2%.

Nyc Income Tax Calculator

Adp Tax Calculator

With single/zero on your W-4, the withholding doesn't sound way out of line assuming it includes federal, state and maybe local income tax, and social security and medicare, although unless you make that much EVERY pay period, you'll probably get some of it refunded when you file.

Many companies take a flat 25% from a bonus or other extraordinary check for federal income tax. If not, and they use the W-4 filing, then the withholding is figured as if you made that amount every pay period. I know, you wish!

Taxes on irregular payments such as bonuses and commissions are withheld at a statutory rate of 25% for Federal income tax, plus Social Security and Medicare at 7.65%, plus any State income taxes. You can easily hit 40% or more if your State has a high income tax rate or a high fixed statutory rate for irregular payments. In CA you would be hit for just under 43%.

Sure. Your commission was treated as income and the additional income moved you into the next tax bracket. So that is Federal, State, Social Security, Medicare, Unemployment and City tax if applicable.

That 45% sounds like you were taxed as if you are self-employed. I pay the employer and employee side, and about 45% of my net income on the Schedule C is owed to the Feds via estimated quarterly payments throughout the tax year.