Tax free over time?

[paulsharvey]

Please, Without politics, anyone give me the cliffs notes of the tax free over time? Is all the OT (upto the limit) exempt, just the extra 50% exempt? Also, it's just Income, not SS and MC, right? They are still taking taxes from it, and then its refunded in 26, with the regular 1040?

 

[paulsharvey]

I think i got somw clarity; but correct me if wrong; 1st; you pay on everything through out the year; 2nd; only the extra 50% for time and a half, is taxed at zero, and thats only income tax. So, the "No tax on OT" really is not remotely correct; its just a slight reduction.

I'll tax a slight reduction, but not as nice as it sounded.

Basically, you work 50 hours, you get paid for 40 at 100%, 10 at 150%, and the 10 hours are IRS taxed at 100%; and then the SS and MC folks still tax it at 150%

 

[part-time-Farmer-NC]

UP to $12,500 in overtime pay if for most filers (and up to $25,000 if you’re Married Filing Jointly).

Only Applies to Federal Taxes due.

And nonexempt employees who work FLSA-qualified overtime

If you make over $150000 per person or $300000 per couple it is phased out

The break down is when you earn say $40 an hour and work 50 hrs all 50 hours are taxed at the same rate. What used to be tax and a half is now just tax...

That is my understanding

 

[paulsharvey]

UP to $12,500 in overtime pay if for most filers (and up to $25,000 if you’re Married Filing Jointly).

Only Applies to Federal Taxes due.

And nonexempt employees who work FLSA-qualified overtime

If you make over $150000 per person or $300000 per couple it is phased out

The break down is when you earn say $40 an hour and work 50 hrs all 50 hours are taxed at the same rate. What used to be tax and a half is now just tax...

That is my understanding

Yeah, after some research, its a pretty small savings, but anything that has me paying less is good.

When they first talked about it, they sure made it sound better though.