Colorado Overtime Tax Deduction Calculator
Hourly workers in Colorado.
The short answer: Pre-loaded with a typical Colorado year, this calculator shows a $3,000 deduction worth $360 at a 12% marginal rate — $14 per paycheck if you're paid biweekly.
Regular rate (not OT rate)
Hours worked beyond 40/week
Modified Adjusted Gross Income
Overtime Premium Deduction
$3,000
✅ You qualify for the full deduction
⚠️ This calculator provides estimates for informational and educational purposes only. It is not tax advice. Results are based on the One Big Beautiful Bill Act (OBBBA) and IRS Schedule 1-A. Consult a qualified tax professional for your specific situation.
How Colorado Overtime Stacks Up
Colorado adds daily/weekly OT for some workers through state wage orders — the federal deduction still keys off 40/week.
- • Colorado wage orders grant OT after 40/week, 12/day for many workers, and 12 consecutive hours — broader than the FLSA in spots
- • The OBBBA deduction base remains premium for hours beyond 40/week
- • Denver/front-range construction, aerospace, and ski-resort economies drive OT
Worked Example
A single Colorado trades worker at $24/hour with 250 OT hours — the exact numbers are editable.
- • Premium portion: $24 ÷ 2 = $12.00/hour on OT hours
- • Deduction: $3,000 (watch the cap and MAGI phase-out as you raise the inputs)
- • Federal income tax savings: $360 at the 12% marginal rate
Keep Reading
Frequently Asked Questions
Does Colorado's 12-hour daily OT qualify for the OBBBA deduction?
Only the premium for hours beyond 40 in the workweek is the safe deduction base; daily-rule premium inside 40 hours is state-law premium.
Ski-resort seasonal hours — count them?
Yes — W-2 OT premium from any season counts for that tax year.
Do I need to itemize to claim it?
No. You claim the qualified overtime premium deduction on your return regardless of whether you take the standard deduction.