How overtime works
The Fair Labor Standards Act requires 1.5× the regular rate for hours over 40 in a workweek for non-exempt employees. Some states (like California) also require daily overtime and double time.
No tax on overtime (2025–2028): you can deduct the premium part of FLSA overtime – the extra half – up to $12,500 ($25,000 married filing jointly). The deduction shrinks by $100 for every $1,000 of modified AGI over $150,000 ($300,000 joint). Social Security and Medicare tax still apply.
FAQ
How much is time and a half on $24 an hour?
$36 an hour. Eight overtime hours pay $288, of which $96 is the deductible premium.
Sources (checked Nov 6, 2026): FLSA (29 U.S.C. 207); IRS FS-2025-03 on OBBBA deductions.