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New Member
posted Jul 25, 2025 5:26:02 AM

How does one big beautiful bill act actually affect me

I seem to be getting a different answer depending on who I ask. I'm mainly curious how the no tax on overtime is actually going to look because I realize it's a tax deduction not a dollar for $1 thing however if I get paid $45,000 a year but my overtime brings me up to 100,000 a year then where would my filing status land because in my mind it would mean that I would still be at the $45,000 mark and not the 100,000 mark but I'm being told that's not the case.

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2 Replies
Level 15
Jul 25, 2025 7:06:50 AM

Specifically regarding no tax on overtime, the law makes the 50% overtime pay exempt from tax on hours over 40 per week, but your base pay is still taxable.   As a simple example, suppose your base pay is $20 per hour and you work 45 hours.  You will be paid 40 hours at $20 per hour and 5 hours at $30 per hour ($20 plus $10 for overtime).  It is the 5 hours x $10 that will be tax-free.  Your base pay (45 hours x $20/hour) is still taxable. 

Level 15
Jul 25, 2025 8:11:17 AM

Also, only the first, $12,500 of the overtime (filing SINGLE) as @Opus 17 calculates it would be deductible.  Not ALL the calculated overtime is deductible. 

 

There is a phaseout that begins at $150,000 of adjusted gross income (again filing SINGLE), which doesn't appear to be at issue in this case.