Qualified Overtime

Employer workflow

Qualified overtime tracking setup for employers

Keep consistent overtime records for covered, nonexempt employees. Document how you calculated the premium so you can answer year-end questions.

Request tracking setup helpReview employee tracking workflow

Not affiliated with the IRS, Treasury, Department of Labor, payroll providers, or tax software vendors. For educational and tracking purposes only.

Concept illustration of blank tracking worksheets, colored dividers, and a white handoff envelope.

Employer use cases

Payroll statement review

Check where each payroll export shows the regular rate, overtime hours, overtime rate, and annual totals.

Employee support

Have the relevant records ready when employees ask about 2025 W-2 Box 14 notes, 2026 Box 12 code TT reporting, portal statements, or their qualified overtime amount.

Preparer handoff

Tell the employee's tax preparer which payroll figures you can confirm and which questions need further review.

A payroll sheet, blue review overlay, and teal record packet linked in a three-stage employer workflow.

Important boundaries for employer tracking

  • Do not treat every premium, bonus, or state-law overtime rule as qualified overtime without FLSA review.
  • Ask the appropriate professional about exemptions, worker classification, regular rate, or collective-bargaining agreements.
  • Keep payroll records in employer-approved systems. This website does not store employee payroll records.
  • Maintain clear language that the employer is not giving employees personal tax advice.

Request tracking setup help

Tell us which payroll provider you use, how many hourly employees you have, and the tax year. Describe the recordkeeping problem you need help with. Do not include employee payroll files.

Do not send sensitive payroll files through this form. Use employer-approved secure systems for employee records.

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Official sources

Source baseline checked 2026-09-08

Review the official guidance directly

IRS FAQ FS-2026-13: Qualified overtime compensation deduction

Defines qualified overtime compensation, FLSA overtime eligibility, deduction limits, reporting rules, and taxpayer requirements.

Internal Revenue Service | FAQ

View official source

IRS overview: No Tax on Overtime deduction

Summarizes the deduction cap, MAGI phase-out thresholds, Social Security number rule, and 2025 reporting note.

Internal Revenue Service | Overview

View official source

IRS Notice 2025-69

Provides 2025 methods for individuals estimating qualified overtime compensation when separate reporting is not available.

Internal Revenue Service | Notice

View official source

2026 Instructions for Forms W-2 and W-3

Explains 2026 Form W-2 reporting, including Box 12 code TT for qualified overtime compensation.

Internal Revenue Service | Instructions

View official source

DOL overtime overview

Explains the FLSA overtime baseline for covered, nonexempt employees working over 40 hours in a workweek.

U.S. Department of Labor | Guidance

View official source