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Started By
Message
re: How will no tax on OT work? Example
Posted on 5/22/25 at 9:08 am to dickkellog
Posted on 5/22/25 at 9:08 am to dickkellog
quote:
40 hours X $50 per hour is $2000 are you retarded? 10 hours X $75 per hour is $750 the $2000 is taxed the $750 is not.
but in the real world, 150k job is salaried jethro
Funny enough my wife makes $75/hr as a W2, so these hourly jobs do exist, but yes very few and far between. Most people making that money or higher are on salary.
0
Posted on 5/22/25 at 9:11 am to greygoose
quote:
That's for State income tax. Federal law is any time over 40 hours in a week. This law will put a lot of pressure on State governments to drop their income tax on OT.
Definitely will put a lot of pressure on same states to do the same. If I'm a state and want to attract a lot of blue collar talent specifically tha tis often paid hourly, I might consider doing this. Working in the restoration (Water/mold/recon) industry we have tons and tons of workers who get a lot of OT. No state tax for some of them where they live on overtime premium pay would make a big difference in their checks. Definitely have guys who make $20k-$30k in OT in a year.
Posted on 5/22/25 at 9:16 am to Cow Drogo
if you read the bill you would know.
You are taxed at the normal rate but the OT extra ($250) in your example will not be taxed.
You are taxed at the normal rate but the OT extra ($250) in your example will not be taxed.
Posted on 5/22/25 at 9:25 am to Cow Drogo
It is still income, we pay an income tax. They probably won't penalize you by withholding a higher percentage than normal. Just make sure you save some cash so that you aren't surprised at the end of the year. I hope that I am incorrect.
Posted on 5/22/25 at 9:28 am to LemmyLives
Holy shite. It's actually called that.
Posted on 5/22/25 at 9:28 am to greygoose
quote:
I know you would receive it back when you file your taxes,
yeh a lot of people don't understand why you get taxed more when working OT one week and not the next.
quote:
give the federal government an interest free loan for a year?
always makes me laugh when people brag about their tax return...but many take it as a windfall and rely on it every year. Hell i know a guy that would take an extra $100 out a week to get bigger returns
Posted on 5/22/25 at 9:40 am to greygoose
quote:
That's for State income tax. Federal law is any time over 40 hours in a week.
California law requires overtime pay for any work over 8 hours in a day, regardless of total weekly hours. For example, if you work a 9-hour shift at McDonald's, you get 8 hours at regular pay and 1 hour at time and a half. Additionally, if you work 10 or more hours, you must take a second lunch break. Their law is unrelated to state taxes.
This post was edited on 5/22/25 at 9:40 am
Posted on 5/22/25 at 9:41 am to Cow Drogo
Have a separate box on the pay stub that gets reported on the W-2. Not that difficult.
Posted on 5/22/25 at 10:07 am to theballguy
quote:
Plus, they'd probably still make you pay FICA on your overtime and of course, the state would still get theirs.
My OT hourly rate is in the neighborhood of $50/hr., and federal takes a huge portion of that. I don't mind paying state and I wouldn't be happy about paying FICA but I wouldn't complain if the biggest portion of that pay went in my pocket. At a certain point, federal actually takes so much that I start LOSING money after a certain amount of OT hours. Haven't done the math since my most recent pay increase though.
Posted on 5/22/25 at 10:09 am to Cow Drogo
quote:
The company o work for breaks it down all separately this way on stub In this scenario It’ would have 50 hours @ 50$ an hour $2500 10 hours @ 1.5 rate 25$ an hour $250
Only this board would downvote a guy sharing personal facts
Posted on 5/22/25 at 10:10 am to The Maj
quote:
it a piece at the time but I really wish the R's
Republicans voted against it.
So good luck ever getting them all on board.
Posted on 5/22/25 at 10:21 am to Cow Drogo
Thaink of the most complicated algorithm you can imagine to compute the difference, now double it, now add 1300 pages of regulation for calculation methods and a list of exemptions, requirements, and qualifications. Add on regulatory fees to be paid by the employee and employer.....
Now let the IRS revoew add in their changes.
Now let the IRS revoew add in their changes.
Posted on 5/22/25 at 11:13 am to BigBinBR
quote:I get that. What I'm saying is, federal law defines OT differently. This tax cut is for Federal income tax. Just because a State defines OT one way, does not mean that the federal govt is going to carve out an exception for one State, while having different rules for the other 49.
California law requires overtime pay for any work over 8 hours in a day, regardless of total weekly hours. For example, if you work a 9-hour shift at McDonald's, you get 8 hours at regular pay and 1 hour at time and a half. Additionally, if you work 10 or more hours, you must take a second lunch break. Their law is unrelated to state taxes.
Posted on 5/22/25 at 11:24 am to TigerAxeOK
quote:My dad is a retired coal miner. When he was working, their payroll person would warn them if their OT was approaching putting them in a higher tax bracket for the next payroll.
My OT hourly rate is in the neighborhood of $50/hr., and federal takes a huge portion of that. I don't mind paying state and I wouldn't be happy about paying FICA but I wouldn't complain if the biggest portion of that pay went in my pocket. At a certain point, federal actually takes so much that I start LOSING money after a certain amount of OT hours. Haven't done the math since my most recent pay increase though.
It's a stupid system that punishes anyone for working more and harder is just dumb.
Posted on 5/22/25 at 11:51 am to Cow Drogo
You are not eligible if you make over $160,000 MAGI. Hard cap, no phase out.
Posted on 5/22/25 at 11:51 am to theballguy
Wrong. It's only on the 0.5 portion of the 1.5.
Posted on 5/22/25 at 11:54 am to TigerAxeOK
quote:
losing money after certain amount of OT
It might be withheld at a different rate.
That's on your employer and payroll administrator.
But, there is no effect on tax whether you work 40 or 70 hr weeks.
I don't understand how this is too difficult for people to grasp.
Posted on 5/22/25 at 11:54 am to theballguy
quote:
Let's say you normally make $20/hour and you work 40 hours. Well, $800 is taxable, so you get to keep around $600 or so. Anything over that, you get to keep.
Wrong. It's only on the $10 extra you make when making $30. And FICA and state taxes are still taken out on all of it.
Posted on 5/22/25 at 12:06 pm to Cow Drogo
Did your parents have any kids who lived?
Posted on 5/22/25 at 12:06 pm to LemmyLives
OP's question boils down to how the bill defines "qualified overtime income."
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