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Overtime Pay Tax Exemption: Keeping Every Extra Penny Earned.

This bill proposes to exclude mandatory overtime compensation from federal gross income calculations for tax purposes. Employees receiving overtime pay under the Fair Labor Standards Act will no longer pay income tax on those specific earnings. Consequently, individuals working extra hours will see an increase in their net take-home pay from overtime work.
Key points
Overtime wages will be exempt from federal income tax.
Workers will keep more of the money earned from working extra hours, boosting net income.
The exemption applies to overtime compensation required by the Fair Labor Standards Act of 1938.
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Additional Information
Keep Every Extra Penny Act of 2024
Print number: HR 8938
Sponsor: Rep. Fulcher, Russ [R-ID-1]
Process start date: 2024-07-08