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The federal overtime provisions are contained in the fair labor standards act Many americans who work overtime will get a break on their taxes for the next few years — but it may not be as hefty as they think. Enter the “no tax on overtime” provision, part of the broader one big beautiful bill (obbba), enacted into law on july 4, 2025 Your employer must pay you at the overtime rate for the extra hours you worked Use the department of labor’s overtime pay calculator to estimate how much overtime pay you may earn. The new federal “no tax on overtime” law may not mean what you think it does To start with, all of your overtime pay is not included “no tax on overtime” is a highly promoted part of. The complete guide to u.s Overtime laws, salary thresholds, and compliance strategies Learn how to calculate overtime and avoid legal penalties in 2025. This guide provides employers with a thorough understanding of federal overtime requirements, including how to determine employee eligibility, calculate correct pay rates, and avoid common compliance pitfalls, with specific attention to variations under state laws like california’s. In this article, we define overtime pay, explain how it functions under federal law and state laws, review different types of overtime work, and provide steps to calculate it using your regular rate of pay or hourly rate. Learn how the one big beautiful bill act could exempt overtime wages from federal income tax See who qualifies and how it impacts paychecks. Overtime workers you have certain wage rights You have the right to be paid for all hours you work in a workweek.