No Tax on Overtime Act

This bill proposes to amend the Internal Revenue Code by allowing a new deduction for qualified overtime compensation . Taxpayers would be able to deduct the amount of overtime pay received that is required under the Fair Labor Standards Act of 1938 and exceeds their regular rate of pay. This provision aims to reduce the tax burden on individuals earning extra income through overtime work. The deduction is subject to specific limitations, including a maximum of 300 hours of service for which compensation can be deducted annually. Furthermore, the deductible amount will be reduced for taxpayers whose modified adjusted gross income surpasses $100,000, or $200,000 for those filing jointly. This deduction would be available to all taxpayers, including those who do not itemize, and employers would be mandated to report qualified overtime compensation on W-2 forms. These amendments are slated to take effect for taxable years beginning after December 31, 2024.