Washington Overtime Tax Deduction Calculator
Hourly workers in Washington.
The short answer: At the scenario numbers pre-loaded below, the OBBBA deduction is $3,510, worth about $421 in federal income tax at a 12% marginal rate ($16 per biweekly paycheck). Change any input and every figure updates live.
Regular rate (not OT rate)
Hours worked beyond 40/week
Modified Adjusted Gross Income
Overtime Premium Deduction
$3,510
✅ 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.
When Washington Hours Go Past 40
Washington leads on both minimum wage and OT salary thresholds — more OT-eligible workers than almost any state.
- • WA OT: 1.5× after 40 hours/week; the state salary threshold for exemption phases toward ~2x the federal level — many salaried WA workers are OT-eligible
- • Seattle-area minimum wages are among the nation's highest — premium halves are large
- • Aerospace (Boeing supply), tech-adjacent facilities, and healthcare drive OT
Worked Example
A single Washington aerospace worker at $27/hour with 260 OT hours — the exact numbers are editable.
- • Premium portion: $27 ÷ 2 = $13.50/hour on OT hours
- • Deduction: $3,510 (watch the cap and MAGI phase-out as you raise the inputs)
- • Federal income tax savings: $421 at the 12% marginal rate
Keep Reading
Frequently Asked Questions
Washington's high salary threshold — how does it interact?
It makes more salaried workers OT-eligible; their W-2 premium dollars then deduct under the OBBBA like anyone else's.
WA has no state income tax on wages — deduction still matter?
Yes — it reduces federal income tax only, which is the whole game in Washington.
Does the overtime deduction change my withholding during the year?
You can adjust your W-4 so the savings show up in each paycheck instead of waiting for a refund — the withholding adjuster on this site walks through it.