Weekly Overtime Tax Savings Calculator
Enter your hours for the week and see how much overtime pay you actually keep after Social Security and Medicare.
Weekly Overtime Tax Savings Calculator
Hourly Rate
Hours Worked This Week
Overtime After
Filing Status
Approximate Annual Salary
Your total yearly income from all sources. The deduction phase-out runs on modified AGI, which equals AGI for most filers.
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)
- Only the 0.5x premium on hours over 40 in the workweek is deductible
- The $12,500 / $25,000 caps are annual — there is no weekly cap
- Temporary: Tax years 2025–2028 only
- Married Filing Separately filers are not eligible (P.L. 119-21 Sec. 225(e))
- SSN required on tax return
Track Your Overtime Automatically
Stop guessing what you'll take home. The app 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. P.L. 119-21 (the One Big Beautiful Bill Act) then lets you deduct part of that pay from federal taxable income — specifically the 0.5x premium on hours the FLSA requires to be paid at a premium. The other two thirds of an overtime check is straight-time wage and stays taxable, as does any premium on hours the FLSA doesn't cover. Social Security (6.2%) and Medicare (1.45%) apply to every overtime dollar 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
The ceiling is annual: $12,500 of overtime premium for single and head-of-household filers, $25,000 for married filing jointly. There is no weekly or per-paycheck cap, so a single week's premium is deductible in full. What the cap does is limit your year: if you keep earning premium at this week's pace, the calculator shows roughly how many weeks it takes to exhaust the annual limit. Married filing separately can't claim the deduction at all.
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.
The federal deduction is FLSA-only. IRC Sec. 225 covers the premium the Fair Labor Standards Act requires, which means hours past 40 in a workweek. Daily overtime owed under state law, contractual overtime after 35 hours, and holiday double time all get paid at a premium, but they qualify for the deduction only where those same hours also exceed 40 for the week. Four 10-hour days is 8 hours of California daily overtime and $0 of federal deduction. This calculator prices your pay from the threshold you set, then deducts only the FLSA-required share.
Frequently Asked Questions
Common questions about weekly overtime tax savings calculator
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 the federal income tax still owed on the part of that pay the deduction doesn't cover. The deduction only covers the 0.5× premium on hours over 40, so the straight-time portion of overtime pay stays taxable.
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: the deductible 0.5× premium on your FLSA overtime hours (hours over 40) times your estimated marginal tax rate.
What happens if I hit the annual cap?
The cap is annual, not weekly: $12,500 ($25,000 for joint filers) of overtime premium per year. Any single week's premium is fully deductible — but once your premiums for the year add up to the cap, every extra overtime dollar is taxed at your regular federal rate for the rest 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. For pay they both count; for the federal deduction only the FLSA hours (over 40 in the week) do.
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) of overtime premium — the 0.5× above the regular rate — from their federal taxes each year through 2028.