Overtime Calculator: Time and a Half & Double Time

The overtime pay formula

Pay = (regular hours × rate) + (overtime hours × rate × 1.5)

Under the Fair Labor Standards Act (FLSA), non-exempt employees get at least 1.5× their regular rate for hours over 40 in a workweek. Example: $20 an hour for 50 hours is 40 × $20 = $800, plus 10 × $30 = $300, for $1,100.00. Each workweek stands on its own; hours can't be averaged across two weeks.

Time and a half vs. double time

Time and a half pays 150% of your regular rate ($20 → $30). Double time pays 200% ($20 → $40). Federal law only requires time and a half. Double time comes from state law (such as California) or from your employer's policy or union contract.

California daily overtime

California also pays overtime by the day: 1.5× for hours over 8 in a workday (up to 12), 2× over 12 hours, and on the 7th consecutive workday of a workweek, 1.5× for the first 8 hours and 2× after that. Weekly overtime still applies after 40 hours, without counting daily overtime hours twice. Five 10-hour days at $20 pay $1,100.00. Other states have their own rules; check your state labor department.

No tax on overtime: what counts

For tax years 2025 through 2028, you can deduct qualified overtime compensation: the part of FLSA-required overtime pay above your regular rate, usually the “half” in time and a half. If you work 50 hours at $20 for 50 weeks, that's $100 a week, or $5,000.00 a year, and your estimated deduction is $5,000.00.

If your employer pays double time, only the FLSA-required half counts: $20 × 10 overtime hours paid at 2× is $400.00, but just $100.00 is qualified (the IRS's own example).

Limits and who qualifies

The deduction is capped at $12,500 a year ($25,000 on a joint return). It shrinks by $100 for every full $1,000 of modified adjusted gross income over $150,000 ($300,000 joint). You need a Social Security number valid for employment, and married couples must file jointly. You must be overtime-eligible (non-exempt) under the FLSA.

Is overtime taxed more?

No. Overtime is taxed as ordinary wages. A bigger paycheck can have more withheld, but your actual tax is figured on your income for the whole year. The new deduction lowers federal income tax only: Social Security and Medicare still apply to all overtime pay, and state income tax rules vary.

How do I calculate time and a half?

Multiply your hourly rate by 1.5. At $18 an hour, time and a half is $27.00. Multiply that by your overtime hours and add your regular pay.

Does no tax on overtime mean overtime is tax-free?

No. It's a federal income tax deduction for the overtime premium only, up to the yearly cap. Your base pay for overtime hours is still taxed, and Social Security and Medicare still apply to all of it.

Does double time count for the overtime deduction?

Only the part federal law requires. For hours over 40 in a week, that's half your regular rate. The rest of a double-time premium, and overtime required only by state law or a union contract, doesn't qualify.

How do I claim it?

On Schedule 1-A of Form 1040. For 2026 onward, employers report qualified overtime on Form W-2 (box 12, code TT). For 2025, employers weren't required to report it separately, and the IRS explains other ways to work it out.

Do salaried employees get overtime?

Some do. Being paid a salary doesn't by itself make you exempt from overtime; it depends on your duties and pay under the FLSA. The Department of Labor explains the tests.

What hourly rate should I use?

Your regular rate. If you also get things like shift differentials or non-discretionary bonuses, the FLSA regular rate can be higher than your base rate, and so is your overtime. This calculator uses the rate you enter.