HR 5475
No Tax on Overtime for All Workers Act
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Bill overview
This bill aims to change how overtime pay is treated for tax purposes. It proposes to allow workers to deduct certain overtime compensation on their tax returns, specifically overtime paid to employees who meet specific criteria outlined in the Fair Labor Standards Act. The bill clarifies the definition of ‘qualified overtime compensation’ and establishes a date for when the changes will take effect.
Key provisions
- Allows a deduction for certain overtime compensation.
- Defines ‘qualified overtime compensation’ under the Fair Labor Standards Act.
- Specifies criteria for overtime compensation to qualify for the deduction.
- Includes provisions for both hourly and non-hourly employees.
- Addresses overtime compensation for railway workers.
Who is affected
- Employees
- Taxpayers
- Employers
Notable changes
- Expands the definition of eligible overtime compensation.
- Creates a new deduction for overtime pay.
Fiscal impact
The bill could potentially impact federal tax revenues by allowing taxpayers to deduct overtime compensation.
Sponsors
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Primary sponsor
Cosponsors
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119th CONGRESS — 1st Session
H. R. 5475
IN THE HOUSE OF REPRESENTATIVES
A BILL
To amend the Internal Revenue Code of 1986 to allow a deduction for certain overtime compensation.
This Act may be cited as the No Tax on Overtime for All Workers Act
.
qualified overtime compensationmeans—
such compensation is paid for work for a single employer pursuant to an agreement between the employee (or labor organization representing such employee) and employer entered into before the performance of the work, and
either—
such work is in excess of a standard number of hours of such work for a specified period of time, and such agreement specifies that such standard number of hours for a specified period of time is not less than 40 hours for a 7-day work period, or
The amendment made by this section shall apply to taxable years beginning after December 31, 2024.