Weekly Overtime Tax Savings Calculator
The One Big Beautiful Bill Act (P.L. 119-21), also known as the "No Tax on Overtime" law, lets eligible hourly workers deduct overtime pay from federal income tax — up to $12,500/year ($25,000 married filing jointly). FICA taxes still apply. The law covers tax years 2025–2028.
Hourly Rate
Hours Worked This Week
Overtime After
Filing Status
Approximate Annual Salary
Your total yearly income from all sources.
Estimates only. Consult a tax professional for accuracy.
Important Notes
- Income tax savings only — Social Security and Medicare still apply to overtime
- FLSA-covered employees only (hourly workers eligible for time-and-a-half)
- Temporary: Tax years 2025–2028 only
- Married Filing Separately filers are not eligible (P.L. 119-21 Sec. 225(d))
Track Your Overtime Automatically
Stop guessing what you'll take home. Hours44 calculates overtime across multiple jobs and shows your pay after taxes.
How the Weekly Calculator Works
From Hours to Take-Home
Plug in your daily hours for the week. Anything over your overtime threshold (usually 40 hours) gets paid at 1.5x your hourly rate. Thanks to P.L. 119-21 (the One Big Beautiful Bill Act), federal income tax on qualifying overtime is waived — though overtime above the weekly deduction cap is still taxed at your marginal rate. Social Security (6.2%) and Medicare (1.45%) apply either way. The "You keep" figure is your overtime pay after subtracting income tax on the non-deductible portion plus those two payroll taxes.
Why Annual Salary Matters
We use your salary to figure out your federal tax bracket. Someone in the 22% bracket saves more per overtime dollar than someone in the 10% bracket, since that's the rate they'd otherwise pay. Your salary also tells us whether the income phase-out chips away at your deduction.
The Deduction Cap
There's a yearly ceiling: $12,500 for single filers, $25,000 for married filing jointly. We split that across 52 weeks to give you a weekly allowance. If you regularly earn more overtime than that weekly slice, the calculator shows roughly how many weeks before you exhaust the annual limit.
Weekly vs. Daily Overtime
The FLSA counts overtime on a weekly basis — anything over 40 hours in a workweek. But California, Alaska, Nevada, and a few other states also enforce daily overtime: if you work past 8 (or 10 or 12) hours in a single day, those extra hours count as overtime even if your weekly total is under 40.
Flip the Weekly/Daily toggle above the threshold to switch modes. In daily mode, each day is measured on its own against the threshold (e.g., 8 hrs). If you go over on any given day, those extra hours are overtime. Try it if your state has daily overtime rules, or if you're curious how a compressed schedule — like four 10-hour shifts — changes the numbers.
Frequently Asked Questions
Common questions about weekly overtime tax savings
How is "You keep" calculated?
Start with gross overtime (overtime hours × rate × 1.5). From that, subtract Social Security (6.2%), Medicare (1.45%), and any federal income tax on overtime above the weekly deduction cap. If all your overtime falls within the cap, federal income tax is $0 — you only lose the payroll taxes.
Why do I still pay Social Security and Medicare?
The law only waives federal income tax on overtime. FICA payroll taxes — 6.2% for Social Security and 1.45% for Medicare — are a separate system and still apply to every overtime dollar you earn.
What does "Federal tax saved" mean?
It's how much federal income tax the deduction saves you this week. The math: your qualifying weekly deduction times your estimated marginal tax rate.
What happens if I hit the annual cap?
There's a yearly limit: $12,500 ($25,000 for joint filers). After your total overtime deductions for the year hit that number, every extra overtime dollar is taxed at your regular federal rate for the remainder of the year.
What is the difference between weekly and daily overtime?
Weekly overtime (the FLSA default) adds up everything over 40 hours in a workweek. Daily overtime, which states like California, Alaska, and Nevada require, looks at each day separately — any hours past the daily threshold (usually 8) count as overtime, regardless of your weekly total. The toggle at the top lets you switch between the two.
Who qualifies for the overtime tax deduction?
You must be a non-exempt hourly worker covered by the FLSA — someone who earns time-and-a-half on overtime. Exempt salaried employees, independent contractors, and self-employed individuals can't claim the deduction, even if they regularly work over 40 hours.
What is the One Big Beautiful Bill Act?
Public Law 119-21, commonly called the One Big Beautiful Bill Act, was signed in 2025. It includes tax breaks for overtime pay, tips, and auto loan interest. The overtime piece (Section 70202, codified as IRC Section 225) lets eligible hourly workers deduct up to $12,500 ($25,000 for joint filers) in overtime pay from their federal taxes each year through 2028.
Need More Than a Quick Calculation?
Hours44 tracks your shifts, calculates overtime automatically, and shows your real take-home pay.