For a $5,000 bonus paid separately on 12/15, I’d use the 22% federal supplemental rate and state supplemental rules, but if it’s combined with regular wages the aggregate method can spike withholding — especially when year-to-date wages are near the Social Security wage base; how are you communicating this to employees and handling W‑4 changes? General information only, not legal advice; consult a qualified attorney for specific cases.
For a 12/15 $5k, we pay separate at 22% and send a stub preview; allow one-time W‑4 bump. https://www.irs.gov/pub/irs-pdf/p15t.pdf.
We schedule the 12/15 $5k as a bonus-only run and, if someone’s about to hit the Social Security wage base, push it to the first payroll after they cap so the 6.2% OASDI doesn’t hit the bonus. We show a quick side-by-side of “22% supplemental vs aggregate” and offer a one-paycheck Step 4(c) add-on with an automatic reset after payroll, @mikeP32. If they still want it combined with wages, we warn about the spike and remind them state supplemental rules may differ; general info only.