No tax on OT

[Mlafond416]

My employer breaks up overtime into different categories in my pay check. For example.  I have OT-Pay listed, Detail Pay, and Grant Pay can it can be three separate lines in my check.  All three are at a time and a half rate above my normal base pay rate and are earned by working additional hours over my normal scheduled working hours.  Will TurboTax know to calculate that? 

[VolvoGirl]

No tax on Overtime. We don't know yet how it works in Turbo Tax. See https://turbotax.intuit.com/tax-reform

Scroll down to Reduced taxes on overtime. It says…..
Like the new tax provision for tips, the new provision for overtime introduces a deduction for qualified overtime income up to $12,500 for tax years 2025 through 2028 and phases out for income above $150,000. While this deduction can lower your taxable income, it is not a dollar-for-dollar reduction of your taxes and the actual tax savings will depend on your tax rate.

See IRS Schedule 1-A part III No Tax on Overtime for how it shows on your tax return.
https://www.irs.gov/pub/irs-dft/f1040s1a--dft.pdf

[Opus 17]

Your W-2 box 1 wages reports your total taxable income.  The IRS has also announced that they will not be changing the W-2 form for 2025, so your OT will not be reported on your W-2 at all.  That means you will report all your taxable income, then you will have to self-report the overtime amount.  We don't know what those questions will look like in Turbotax.  But Turbotax will never see your pay stub. 

The part that is tax-free is only the half-time for working 40 hours or more, not your base pay, and only up to $12,500 per year, and only if your income is less than $150,000.  

Meaning that, if you work 60 hours at $20 per hour base pay ($30/hr OT), the tax-free portion would be 20 hours x $10.