Qualified overtime pay is deductible on your 2025 federal income tax return.

elitetaxes256
Jan 25
1 min read

The One Big Beautiful Bill Act (OBBA) that was signed into law on July 4,

2025, allows individuals to deduct qualified overtime pay for tax year 2025.

Although the IRS does not require employers to report, they have strongly

urged them to provide a best estimate to employees regarding this amount

in Box 14 on the W-2, with a code like “OT” or OBBOTT”. Please note that

eligibility to deduct the deductible amount depends on your individual tax

situation, not what is reported in Box 14 of the W-2 form.

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