Referred to the House Committee on Ways and Means.
This bill creates a new federal income tax deduction for overtime compensation that is equal to overtime pay up to 20% of an individual’s other wages from the same employer in the taxable year. The deduction is available to non-itemizers, excludes taxpayers above specified adjusted gross income thresholds, requires updates to withholding tables, and automatically expires after December 31, 2029.
Left stresses labor enforcement over tax relief
Relative to its intended legislative type, this bill is a straightforward statutory modification establishing a new temporary individual tax deduction for certain overtime compensation and includes necessary conforming amendments to the Internal Revenue Code and a directive to update withholding procedures.
This bill creates a new federal income tax deduction for overtime compensation that is equal to overtime pay up to 20% of an individual’s other wages from the same employer in the taxable year.
The deduction is available to non-itemizers, excludes taxpayers above specified adjusted gross income thresholds, requires updates to withholding tables, and automatically expires after December 31, 2029.
The amendments take effect for amounts received after enactment.
Narrow, administrable tax cut with sunset increases feasibility, but revenue impact and lack of offsets reduce prospects, especially in the Senate.
Relative to its intended legislative type, this bill is a straightforward statutory modification establishing a new temporary individual tax deduction for certain overtime compensation and includes necessary conforming amendments to the Internal Revenue Code and a directive to update withholding procedures.
Left stresses labor enforcement over tax relief
These are examples from the analysis, not a ranked list of the most-affected groups.
Left stresses labor enforcement over tax relief
Generally favorable to targeted relief for hourly workers who earn overtime, but cautious.
Would view the deduction as a limited way to boost take-home pay, while preferring stronger labor enforcement or wage policy changes over a tax expenditure.
Mildly supportive as targeted, time-limited tax relief for working households.
Sees merit in helping overtime earners but wants clarity on fiscal cost, administrative burden, and labor-market incentives.
Cautiously favorable because it lowers income tax on earned overtime and is temporary.
Concerned about targeted tax expenditures, cost, and potential new compliance burdens for employers.
Reached or meaningfully advanced
Reached or meaningfully advanced
Still ahead
Still ahead
Still ahead
Narrow, administrable tax cut with sunset increases feasibility, but revenue impact and lack of offsets reduce prospects, especially in the Senate.
The bill has not accumulated any surfaced votes yet.
Left stresses labor enforcement over tax relief
Narrow, administrable tax cut with sunset increases feasibility, but revenue impact and lack of offsets reduce prospects, especially in the…
Relative to its intended legislative type, this bill is a straightforward statutory modification establishing a new temporary individual tax deduction for certain overtime compensation and includes necessary conforming…
Go beyond the headline summary with full stakeholder mapping, legislative design analysis, passage barriers, and lens-by-lens tradeoff breakdowns.