Overtime paycheck calculator
Overtime is withheld at your marginal rate, not a special one. Enter your rate and extra hours to see what they are actually worth.
Where every dollar goes
2026 tax year · 26 pay periods| Line | Per paycheck | Per year |
|---|---|---|
| Gross pay | $2,615.38 | $68,000.00 |
| 401(k) contribution | −$130.77 | −$3,400.00 |
| Federal income tax | −$130.46 | −$3,392.00 |
| Social Security | −$162.15 | −$4,216.00 |
| Medicare | −$37.92 | −$986.00 |
| Texas state income tax | $0.00 | $0.00 |
| Take-home pay | $2,154.08 | $56,006.00 |
What overtime hours add after tax
Texas, single filer, 40 regular hours a week. Overtime paid at one and a half times the regular rate.
| Regular rate | Overtime rate | No overtime | 5 hours a week | 10 hours a week |
|---|---|---|---|---|
| $15.00 | $22.50 | $27,249 | $31,950 | $36,650 |
| $20.00 | $30.00 | $35,606 | $41,873 | $48,140 |
| $25.00 | $37.50 | $43,962 | $51,796 | $59,130 |
| $30.00 | $45.00 | $52,318 | $60,959 | $69,190 |
| $40.00 | $60.00 | $67,361 | $78,336 | $89,310 |
Overtime is withheld at your marginal rate, which is why the extra take-home is proportionally smaller than the extra gross. Ten overtime hours a week is a quarter more hours, but noticeably less than a quarter more money in hand.
The 2026 qualified overtime deduction
This changed recently and is worth understanding, because the phrase "no tax on overtime" is misleading.
For tax years 2025 through 2028 there is a deduction for qualified overtime premium pay: the half-time premium above your regular rate, not the whole overtime payment. The maximum is $12,500 for a single filer and $25,000 for a joint filer, and it phases out above $150,000 and $300,000 of modified adjusted gross income.
Three things follow. It is claimed on your return, not through payroll, so your paycheck does not change. It is available whether or not you itemise. And it does not reduce Social Security or Medicare, which are charged on the full amount.
Several states have also decoupled from it, meaning the deduction applies federally but not at state level. Check your own state page for how it is treated.
Who is entitled to overtime
Under the Fair Labor Standards Act, non-exempt employees must be paid at least one and a half times their regular rate for hours past 40 in a workweek. The regular rate includes most bonuses and shift differentials, not just base pay, which means your overtime rate can be higher than base multiplied by 1.5.
Exempt employees, generally those in executive, administrative or professional roles paid above a salary threshold, are not entitled to it. Job title alone does not decide this, and misclassification is common.
Some states are stricter than federal law. California requires daily overtime past 8 hours and double time past 12. A handful of others have their own daily rules.
Common questions
- Is overtime taxed at a higher rate?
- Overtime is withheld at your marginal rate, not a special overtime rate. It feels higher because the extra income sits on top of your regular pay, so it is taxed in your highest bracket rather than your average rate.
- Is there really no tax on overtime in 2026?
- Not quite. For 2025 to 2028 you can deduct qualified overtime premium pay, up to $12,500 single or $25,000 joint, phasing out above $150,000 and $300,000 of modified AGI. It covers the premium half only, it is claimed on your return rather than through payroll, and it does not reduce Social Security or Medicare.
- How is my overtime rate calculated?
- One and a half times your regular rate, which includes most non-discretionary bonuses and shift differentials, not only base pay. At $25 an hour base the overtime rate is at least $37.50.
- Do salaried employees get overtime?
- Some do. Being salaried does not make you exempt. Exemption depends on your duties and whether you are paid above the salary threshold. Non-exempt salaried employees are still owed overtime past 40 hours a week.
Choose your state
State rules change the answer more than anything else on this page.