How to use this calculator
- Hourly rate. Your regular straight-time rate. If you also earn shift differentials or nondiscretionary bonuses, your legal “regular rate” is higher; see the limitations below.
- Weekly totals. Enter regular hours and overtime hours, and choose time and a half or double time. You can add double-time hours on top.
- Daily schedule. Choose Daily schedule, pick the rules (federal, California, Alaska, Nevada or Colorado) and enter hours for each day from Sunday to Saturday. The calculator splits them into straight time, overtime and double time.
- No tax on overtime estimate. Open this section, enter how many weeks a year look like this and your filing status to estimate the 2026 federal deduction and what it saves you.
The formula
The overtime premium is the extra pay above straight time: 0.5 × rate per overtime hour, or 1 × rate per double-time hour. The federal deduction covers only the FLSA part: 0.5 × regular rate × hours over 40 in the workweek.
Worked examples
Federal rules. At $25 an hour, 40 regular hours pay $1,000 and 6 overtime hours at $37.50 pay $225: $1,225.00 for the week. The premium is $75, all of which counts toward the federal deduction. Fifty weeks like this add up to $3,750 of qualified overtime; for a single filer earning about $61,250, that deduction saves about $450 in 2026 federal income tax.
California, long days. Monday and Tuesday 10 hours, Wednesday and Thursday 8, Friday 9: 45 hours. Daily overtime is 2 + 2 + 1 = 5 hours, and straight time is exactly 40, so the week pays $1,187.50. Federal rules happen to give the same 5 hours here. The difference shows in a week of four 10-hour days: 40 hours, so no federal overtime ($1,000), but 8 daily overtime hours in California ($1,100).
California, seven days. Add 13 hours on Sunday and 10 on Saturday. Sunday has 4 hours at 1.5× and 1 at 2×. Saturday is the seventh straight workday, so its first 8 hours are 1.5× and the last 2 are 2×. Straight time over 40 adds weekly overtime. Total: 40 regular, 25 overtime and 3 double-time hours, $2,087.50.
Colorado, three 13-hour days. Only 39 hours, so there’s no weekly overtime, but each day has 1 hour over 12: 3 overtime hours, $1,012.50. None of it counts for the federal deduction, because the week didn’t exceed 40 hours.
Daily overtime rules by state
| State | Time and a half | Double time | Notes |
|---|---|---|---|
| Federal (all states) | Over 40 hours a week | Not required | Fair Labor Standards Act |
| California | Over 8 a day, over 40 a week, first 8 on the 7th straight day | Over 12 a day; over 8 on the 7th day | Labor Code §510 |
| Alaska | Over 8 a day or 40 a week | Not required | Employers with 4+ employees; flexible plans can allow 10-hour days |
| Nevada | Over 8 a day (if paid under $18.00/hr) or 40 a week | Not required | Four 10-hour days by agreement are exempt |
| Colorado | Over 12 a day, 12 consecutive hours, or 40 a week | Not required | Whichever gives more pay (COMPS Order #40) |
Hours already paid as daily overtime aren’t counted again toward the 40-hour week.
Overtime pay by hourly rate
A 40-hour week plus overtime at time and a half.
| Hourly rate | Overtime rate | With 5 OT hours | With 10 OT hours |
|---|---|---|---|
| $15 | $22.50 | $712.50 | $825.00 |
| $20 | $30.00 | $950.00 | $1,100.00 |
| $25 | $37.50 | $1,187.50 | $1,375.00 |
| $30 | $45.00 | $1,425.00 | $1,650.00 |
| $40 | $60.00 | $1,900.00 | $2,200.00 |
The federal overtime deduction (2025–2028)
The One Big Beautiful Bill Act created a deduction for qualified overtime compensation for tax years 2025 through 2028. The IRS rules, as of its August 2026 FAQ:
- What counts: the “half” portion of the time-and-a-half the FLSA requires for hours over 40 in a workweek. Straight-time pay, overtime required only by state law or a union contract, and pay above 1.5× don’t count.
- Cap: $12,500 a year, $25,000 on a joint return.
- Phase-out: reduced by $100 for each full $1,000 of modified AGI over $150,000 ($300,000 joint). A single filer with $160,000 of income and $12,500 of qualified overtime can deduct $11,500.
- Who: you need a Social Security number valid for employment, and married couples must file jointly. You can claim it whether or not you itemize.
- Reporting: starting with 2026, employers report qualified overtime on Form W-2, box 12, code TT. You claim the deduction on Schedule 1-A.
- It lowers federal income tax only. Social Security and Medicare still apply to all overtime pay.
To have less withheld during the year, claim it on Form W-4 Step 4(b); the W-4 calculator works out the entry.
Assumptions & limitations
- Weekly results assume one workweek, Sunday to Saturday, and one job at one rate. Under the FLSA, your regular rate must include shift differentials and nondiscretionary bonuses; this calculator uses the rate you enter.
- Exempt employees (many salaried professionals and managers) aren’t entitled to overtime. Some industries and small employers are exempt from state daily rules.
- California’s seventh-day rule applies when you work all seven days of the workweek. Alaska and Nevada exceptions (small employers, flexible schedules, four 10-hour days) aren’t applied automatically.
- The deduction estimate uses 2026 federal brackets, the standard deduction and wages as your only income. For the take-home effect of overtime on a paycheck, use the paycheck calculator; to convert hours to annual pay, the salary calculator.
Sources
- U.S. Department of Labor: Overtime pay
- California DLSE: Overtime FAQ (Labor Code §510)
- Alaska Statutes §23.10.060: Payment for overtime
- Nevada Revised Statutes 608.018 and 608.250
- Colorado COMPS Order #40 (effective Feb. 1, 2026)
- IRS FS-2026-13: Questions and answers on the deduction for qualified overtime compensation
- IRS Schedule 1-A (Form 1040): Additional deductions
Results are estimates for planning. Your employer’s payroll and your state’s rules may differ.
Frequently asked questions
How is overtime pay calculated?
Under federal law, nonexempt employees earn at least 1.5 times their regular rate for every hour over 40 in a workweek. At $25 an hour, each overtime hour pays $37.50, so a 46-hour week pays $1,000 for the first 40 hours plus $225 for the 6 overtime hours, $1,225 in all.
Which states have daily overtime?
California, Alaska, Nevada and Colorado require overtime for long workdays, not just long weeks. California pays 1.5 times after 8 hours a day and double after 12; Alaska pays 1.5 times after 8; Nevada does after 8 for workers paid under 1.5 times the minimum wage; Colorado does after 12 hours.
What is the no tax on overtime deduction?
For 2025 through 2028, you can deduct the extra half of time-and-a-half pay that federal law requires, up to $12,500 a year ($25,000 joint). It shrinks by $100 for each $1,000 of income over $150,000 ($300,000 joint). It cuts federal income tax only; Social Security, Medicare and most state taxes still apply.
Does California daily overtime count for the federal deduction?
Only the overtime the federal Fair Labor Standards Act requires counts, which is the half-time premium on hours over 40 in a workweek. Overtime paid only because of a state daily rule, a union contract or employer policy, and the extra half of double time, don’t qualify.
Is overtime taxed at a higher rate?
No. Overtime is ordinary wages taxed at your normal bracket. A big overtime check can have more withheld because payroll treats it as if you earned that much every period, but any excess comes back when you file.
Can my employer give comp time instead of overtime pay?
Private-sector employers generally must pay overtime in cash in the week it’s earned. Comp time instead of overtime pay is allowed only for certain public-sector employees under the FLSA. Some states have their own rules.
Updated November 2026. Results are estimates for educational purposes and depend on the inputs you provide.