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← Overtime Deduction Calculator

Welder Overtime Tax Deduction Calculator

Run your real overtime numbers below. The estimate applies the same Schedule 1-A math as your federal return — no tax software, no signup.

The short answer: Nadia — at the scenario numbers pre-loaded below, the OBBBA deduction is $7,250, worth about $1,595 in federal income tax at a 22% marginal rate ($61 per biweekly paycheck). Exact figures update live as you change the inputs.

$

Regular rate (not OT rate)

Hours worked beyond 40/week

$

Modified Adjusted Gross Income

Overtime Premium Deduction

$7,250

Est. Federal Tax Savings (22% bracket)$1,595

✅ 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.

What Counts (and What Doesn't)

Turnaround and outage seasons concentrate OT into brutal eight-week windows — those paystubs are your documentation. Travel welders living on per-diem should note the allowances are not wages; only the OT premium on your hourly is deductible, and per-diem under an accountable plan stays out of MAGI, which helps your phase-out position.

The full rules, caps and phase-outs for every deduction are in one table on the OBBBA rules page.

Worked Example

Nadia welds structural steel at $29/hour, and project deadlines plus turnaround seasons push her to 500 overtime hours a year.

  • • Deductible amount: $7,250
  • • Federal income tax savings: $1,595 (at the 22% marginal rate)
  • • Per biweekly paycheck: $61

Every dollar of that comes off federal income tax while FICA still applies — the calculator above runs the same caps and phase-outs your return will.

Keep Reading

Frequently Asked Questions

Do turnaround and outage season hours count?

Yes — the deduction does not care when during the year the overtime happens. Refinery turnarounds and plant outages often deliver 70-80 hour weeks for two months, and all of that W-2 overtime premium counts toward the annual deduction.

Do I need to itemize deductions to claim the overtime deduction?

No. The overtime premium deduction is an above-the-line adjustment on Schedule 1-A — you can take the standard deduction and still claim it in full.