💸 Gross-Up Calculator: Net to Gross Pay and Bonus Gross-Up
By Shihab Mia · Reviewed by ToolNimba Editorial Review, payroll and personal finance content · Updated 2026-07-25
This calculator gives an estimate only and is not tax, payroll or financial advice. A real gross-up usually involves several deductions at different rates (federal income tax, Social Security, Medicare, state and local taxes) that do not combine into one flat rate, and some are capped or tiered. Confirm the exact figures with your payroll provider or a qualified tax adviser before relying on them.
A gross-up calculator answers one question: what gross payment, after a given deduction rate is taken out, leaves exactly the net amount you want someone to keep? Enter the desired net amount and the total deduction rate, and the formula gross = net / (1 - rate / 100) returns the gross to pay and the deduction it covers. This is how employers set bonus, relocation and sign-on payments so the promised take-home figure actually lands, and how freelancers back into a fee that still nets a target amount after a flat withholding tax.
What is the Gross Up Calculator?
Gross-up is the standard way employers make sure a payment arrives at a promised amount after tax and other deductions are taken out. If you simply pay someone a $1,000 bonus and 30% is withheld, they keep only $700. To make them keep the full $1,000, you have to pay a larger gross so that the 30% deduction still leaves $1,000. That larger gross is what the gross-up formula finds.
The maths is short. If the deduction rate is r percent, then net = gross x (1 - r/100). Rearranging for gross gives gross = net / (1 - r/100). The term (1 - r/100) is the fraction of each dollar that survives the deductions, so dividing the net by it scales the payment up to cover what will be withheld. The deduction amount is simply gross minus net. A common mistake is to add the rate back instead of dividing: adding 30% to $1,000 gives $1,300, but $1,300 taxed at 30% leaves only $910, not $1,000. Dividing by 0.70 gives the correct $1,428.57.
For US bonuses specifically, employers usually use the percentage method: a flat federal withholding rate on supplemental wages (22% for bonuses up to $1 million, 37% on the amount over $1 million), plus FICA at 7.65% (6.2% Social Security, capped at the annual wage base, plus 1.45% Medicare, uncapped), plus whatever state and local supplemental rate applies. Combine those into one rate and the gross-up formula works cleanly, which is why 22% + 7.65% = 29.65% federal-plus-FICA is such a common starting point before state tax is layered on. Note that 22% is a flat withholding rate, not the employee's actual tax bracket. At tax filing time the bonus is pooled with all other income and taxed at the employee's real marginal rate, so the amount withheld during the year and the amount ultimately owed can differ.
The single biggest caveat with any gross-up is that real payroll deductions are rarely one flat percentage. Income tax is tiered, Social Security has a wage cap, and state or local supplemental rates vary widely, from 0% in states with no income tax to over 10% in a few states. A true payroll gross-up either uses an accurate combined effective rate for that specific employee or, in cases where a deduction is itself calculated on the grossed-up amount (such as employer-paid FICA match rules or benefits phase-outs), solves iteratively rather than in one step. This tool uses a single combined rate, which is exact when that rate genuinely is flat (for example, a fixed supplemental withholding percentage) and a close estimate when several tiered or capped deductions are approximated as one number.
Gross-ups are not limited to payroll. Landlords and lenders sometimes gross up a rental applicant's non-taxable income (Social Security, disability, some housing subsidies) to make it comparable to taxable income when checking rent-to-income ratios, typically by dividing the non-taxable amount by (1 - an assumed tax rate) to estimate its taxable-equivalent value. Businesses also gross up relocation reimbursements, tuition benefits above the tax-free limit, and executive perks so the recipient is not left worse off after tax. The formula is identical in every case: divide the target net by the surviving fraction after the applicable rate.
When to use it
- Grossing up an employee bonus so the person actually receives the promised net amount after federal, FICA and state withholding.
- Setting a relocation or sign-on payment so the net lands at the figure offered in the contract or offer letter.
- Working out the gross invoice or fee needed to net a target amount after a flat withholding tax.
- Quoting a freelance or contractor rate that still leaves a desired take-home once a fixed tax percentage is removed.
- Grossing up non-taxable income (Social Security, disability benefits) to a taxable-equivalent figure for a mortgage or rental application.
- Checking whether a stated bonus amount is already grossed up, by comparing the promised net against what a straight withholding would leave.
How to use the Gross Up Calculator
- Enter the desired net amount, the take-home figure you want the person to keep.
- Enter the total deduction rate as a percentage (combine all flat deductions, such as federal supplemental rate, FICA and state rate, into one number).
- Read off the required gross amount and the total deduction it implies.
- Use a quick-rate button to try common rates, or type any rate below 100%.
- For payroll bonuses, start from 22% federal plus 7.65% FICA plus your state supplemental rate, then confirm the final figure with payroll before issuing payment.
Formula & method
Worked examples
You want an employee to keep $1,000 after a flat 30% deduction.
- Surviving fraction = 1 - 30 / 100 = 0.70
- gross = 1,000 / 0.70 = 1,428.5714
- deduction = 1,428.57 - 1,000 = 428.57
- Check: 1,428.57 x 0.70 = 1,000.00
Result: Gross ≈ $1,428.57, deduction ≈ $428.57, net = $1,000.00
A relocation payment must net $5,000 after combined deductions of 22%.
- Surviving fraction = 1 - 22 / 100 = 0.78
- gross = 5,000 / 0.78 = 6,410.2564
- deduction = 6,410.26 - 5,000 = 1,410.26
- Check: 6,410.26 x 0.78 = 5,000.00
Result: Gross ≈ $6,410.26, deduction ≈ $1,410.26, net = $5,000.00
A $5,000 net bonus using the standard US percentage method: 22% federal supplemental rate, 7.65% FICA and a 5% state supplemental rate.
- Combined rate = 22 + 7.65 + 5 = 34.65%
- Surviving fraction = 1 - 34.65 / 100 = 0.6535
- gross = 5,000 / 0.6535 = 7,651.11
- deduction = 7,651.11 - 5,000 = 2,651.11
- Check: 7,651.11 x 0.6535 = 5,000.00
Result: Gross bonus ≈ $7,651.11, deduction ≈ $2,651.11, employee nets $5,000.00
Required gross to net $1,000 at different flat deduction rates
| Deduction rate | Surviving fraction | Required gross | Deduction amount |
|---|---|---|---|
| 10% | 0.90 | $1,111.11 | $111.11 |
| 20% | 0.80 | $1,250.00 | $250.00 |
| 25% | 0.75 | $1,333.33 | $333.33 |
| 30% | 0.70 | $1,428.57 | $428.57 |
| 34.65% | 0.6535 | $1,530.22 | $530.22 |
| 40% | 0.60 | $1,666.67 | $666.67 |
2026 US supplemental wage rates commonly used to build a combined gross-up rate
| Deduction | Rate | Notes |
|---|---|---|
| Federal supplemental withholding (percentage method) | 22% | Applies to bonuses and other supplemental wages up to $1 million in a year |
| Federal supplemental withholding, amount over $1 million | 37% | Top rate applies only to the portion above $1 million in supplemental wages for that employee in the year |
| Social Security (FICA) | 6.2% | Applies only up to the annual wage base ($184,500 for 2026); no tax above that amount |
| Medicare (FICA) | 1.45% | Applies to all wages with no cap; an extra 0.9% applies above statutory thresholds |
| State supplemental rate | Varies, 0% to over 10% | Set by each state; some states have no income tax and therefore no supplemental rate |
Common mistakes to avoid
- Adding the rate instead of dividing by the surviving fraction. Adding 30% to a $1,000 net gives $1,300, but $1,300 taxed at 30% leaves $910, not $1,000. The correct gross-up divides by 0.70 to get $1,428.57, which does net $1,000.
- Treating several tiered deductions as one flat rate. Income tax brackets, capped Social Security and varying state or local taxes do not collapse into a single percentage. Using one combined rate is exact only when the real rate is genuinely flat, otherwise it is an estimate.
- Mistaking the 22% flat bonus rate for the employee's real tax rate. The 22% federal supplemental rate is a flat withholding percentage used during the year, not the employee's final tax liability. At filing time the bonus is pooled with regular income and taxed at the employee's actual marginal rate, so the withheld amount and the amount ultimately owed can differ.
- Ignoring that the gross-up itself can raise the effective rate. Paying a larger gross can push income into a higher tax bracket or past the Social Security wage base, so the effective rate on the grossed-up payment may differ from the rate on the original amount. A true gross-up sometimes needs an iterative calculation.
- Forgetting the Social Security wage base cap. The 6.2% Social Security portion of FICA only applies up to the annual wage base ($184,500 in 2026). If an employee has already earned above that cap for the year, that 6.2% should be dropped from the combined rate for this payment.
- Entering a deduction rate of 100% or more. If deductions take 100% of every dollar, no gross can leave a positive net, so the gross-up is undefined. The rate must be below 100% for the formula to return a finite gross.
Glossary
- Gross amount
- The total payment before any tax or deductions are taken out.
- Net amount
- The take-home figure that remains after all deductions have been applied.
- Gross-up
- Calculating the gross payment needed so that the net, after deductions, equals a chosen target.
- Deduction rate
- The combined percentage of the gross removed as tax and other withholdings.
- Surviving fraction
- The share of each dollar left after deductions, equal to 1 minus the rate as a decimal.
- Supplemental wages
- Pay outside regular wages, such as bonuses, commissions and relocation payments, which the IRS allows employers to withhold at a flat percentage rather than the employee's regular withholding rate.
- Percentage method
- The IRS-permitted approach of withholding a flat rate (22% for most bonuses) on supplemental wages instead of adding the bonus to regular pay and withholding at the aggregate rate.
- FICA
- Federal Insurance Contributions Act tax, made up of 6.2% Social Security (capped at the annual wage base) and 1.45% Medicare (uncapped).
Frequently asked questions
What is a gross-up?
A gross-up calculates the larger gross payment needed so that, after deductions are taken out, the recipient keeps a specific net amount. Employers use it for bonuses, relocation and reimbursements so the promised take-home figure is exactly what arrives.
How do I calculate gross from net?
Divide the net by the surviving fraction: gross = net / (1 - rate / 100). For a $1,000 net at a 30% deduction rate, that is 1,000 / 0.70 = $1,428.57. The deduction is the gross minus the net.
Why not just add the tax percentage to the net?
Because the deduction applies to the larger gross, not to the net. Adding 30% to $1,000 gives $1,300, but taxing $1,300 at 30% leaves only $910. Dividing by 0.70 instead gives $1,428.57, which correctly nets $1,000.
How do I gross up a bonus?
Enter the net bonus you want the employee to keep and the combined withholding rate that applies, typically 22% federal plus 7.65% FICA plus any state supplemental rate. The calculator returns the gross bonus to pay and the deduction it covers, so the employee receives the full promised amount.
What rate should I use for payroll deductions?
Use the combined flat rate of all deductions that apply: the 22% federal supplemental withholding rate, 7.65% FICA (6.2% Social Security up to the wage base plus 1.45% Medicare), and any state supplemental rate. Because real rates can be tiered or capped, treat the result as an estimate and confirm with payroll.
Is 22% the actual tax rate on a bonus?
No. The 22% federal rate is a flat withholding percentage used only to calculate how much tax is held back from the bonus at payment time. At tax filing, the bonus is combined with all other income for the year and taxed at the employee's real marginal rate, which may be higher or lower than 22%.
Are all bonuses grossed up?
No. Gross-ups are the exception, not the rule, and are most common for senior executive pay, relocation packages, and specific retention or M&A bonuses. Unless an offer letter or bonus plan explicitly states the amount is grossed up, assume the stated bonus is the gross figure that will be taxed as normal.
What happens if the deduction rate is 100% or more?
The gross-up becomes impossible. If deductions remove every dollar, no gross amount can leave a positive net, so the formula is undefined. The rate must be below 100% to produce a finite gross.
Does the Social Security portion of FICA always apply?
Only up to the annual Social Security wage base, which is $184,500 for 2026. Once an employee's year-to-date wages pass that cap, the 6.2% Social Security portion no longer applies and should be dropped from the combined deduction rate for later payments that year.
Can I use a gross-up calculator for non-payroll situations?
Yes. The same formula is used to gross up non-taxable income (such as Social Security or disability benefits) to a taxable-equivalent figure for mortgage or rental qualification, and to work out invoice or freelance fees that need to net a target amount after a flat withholding tax.
Sources
- Gross-Up: Definition, Example, Formula, and Calculation , Investopedia
- Publication 15 (Circular E), Employer's Tax Guide , U.S. Internal Revenue Service
- Topic no. 761, Tips, withholding and reporting (supplemental wage withholding) , U.S. Internal Revenue Service
- Social Security Wage Base and COLA for 2026 , Social Security Administration