Federal qualified-overtime deduction
No Tax on Overtime Deduction Calculator
Estimate the federal income-tax deduction for qualified FLSA overtime premium compensation.
For default paycheck withholding, use the overtime tax calculator.
How the federal deduction is estimated
Use qualified overtime premium compensation, not full time-and-a-half overtime pay. The cap is $12,500 for non-joint eligible returns and $25,000 for joint returns; MFS is unavailable.
MAGI is AGI plus IRC 911/931/933 exclusions. The phase-out starts above $150,000 of MAGI, or $300,000 joint, by $100 per $1,000 above the threshold. FICA still applies.
The W-4 mode estimates 2026 Form W-4 Step 4(b) treatment and requires submitting an updated W-4.
State conformity table
State treatment is source-dated. Pending rows stay pending until an official state source resolves them.
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Frequently asked questions
What is the no tax on overtime deduction?
It is a federal income-tax deduction for qualified FLSA overtime premium compensation, not a FICA exemption or special overtime rate.
Who qualifies for the qualified overtime deduction?
It generally applies to FLSA section 7 overtime premium compensation for tax years 2025 through 2028, subject to federal limits.
How is this different from the overtime tax calculator?
The overtime tax calculator estimates default paycheck withholding. This page estimates the filing-time deduction and W-4 adjustment path.
Do states follow the federal overtime deduction?
State treatment varies; unresolved states are shown as pending rather than guessed.
When does the federal overtime deduction sunset?
Under current law, it applies to tax years 2025 through 2028.