What counts as qualified overtime?
IRS guidance describes qualified overtime compensation as overtime pay required under FLSA that exceeds the regular rate. For ordinary time-and-a-half, that is generally the extra half-time premium.
No tax on overtime calculator
No Tax on Overtime Calculator
Estimate the qualified overtime premium that may be deductible under current IRS rules. This calculator focuses on the overtime premium portion, not all overtime wages.
Last reviewed: September 21, 2026
Deduction estimateNot all overtime is tax-free. Current IRS guidance generally points to the premium above the regular rate.
Deduction estimator
No tax on overtime calculator
Estimate the qualified overtime premium that may be deductible. For a 1.5x overtime rate, this usually means the extra 0.5x premium, not the full overtime paycheck.
Full overtime pay$15,000.00
Potentially qualified premium$5,000.00
Estimated deduction$5,000.00
Why full overtime pay is different
A $30 overtime hour for a $20 hourly worker includes $20 of regular-rate pay and $10 of extra premium. The calculator separates those amounts so the estimate does not treat the full overtime paycheck as deductible.
What are the limits?
The annual deduction is capped at $12,500 per return, or $25,000 for married filing jointly, and phases out above modified adjusted gross income thresholds.
Why this is not a refund calculator
Final tax results depend on forms, filing status, income, withholding, Social Security number requirements, employer reporting, and current IRS instructions.
Quick examples
Official references
Review official guidance before relying on any estimate for a tax return or payroll decision.
Important limits
This calculator provides estimates only. It does not decide whether you are legally entitled to overtime, whether an employer is compliant, or what your final paycheck or taxes should be. Overtime rules can vary by jurisdiction, exemption status, bonuses, commissions, employer policy, and other pay types.