No Tax on Overtime Calculator

New for 2025 to 2028. Deduct the extra half of your time and a half pay. See your savings in seconds.

Your regular hourly wage ($)

Overtime hours you expect this year

Filing status

Total income for the year (MAGI, $)

Your tax bracket

How the overtime deduction works

The deduction covers the premium part of your overtime pay. That is the extra half in time and a half. Work an hour at $30 regular pay and you earn $45 in overtime. Only the extra $15 is deductible. Your W-2 will show the qualified amount in box 12.

The caps

The most you can deduct is $12,500 per year. Married couples filing jointly can deduct up to $25,000. The deduction runs for tax years 2025 through 2028. You can claim it on top of the standard deduction using Schedule 1-A.

The income phase out

The deduction drops by $100 for every $1,000 of income above $150,000. For married couples the limit is $300,000.

Who qualifies

The overtime must be required by federal law (FLSA). That means hourly workers past 40 hours a week. Overtime that only comes from a state rule or a union contract may not count. Salaried workers who are exempt from overtime do not qualify. You still pay Social Security and Medicare tax on overtime.

This tool gives a simple estimate for planning. It is not tax advice. Confirm your qualified overtime amount on your W-2 and talk to a tax professional before filing.