No Tax on Overtime Calculator by State

The one thing most state calculators get wrong

The OBBBA qualified overtime deduction is claimed on Schedule 1-A and reduces federal taxable income, not federal adjusted gross income. A state that begins its computation from federal AGI does not see the deduction unless it passed its own subtraction or updated its conformity date. Whether any particular state did so is a question of that state's own law.

We have not verified any state's current conformity position against a first-party source, so none of these pages asserts a state's status as fact. Each calculator starts from the conservative assumption (your state still taxes the overtime you deducted federally) and lets you switch it once you have confirmed your state's rule. Sources last checked 2026-11-12; federal basis: IRS Notice 2025-69 and IRS Fact Sheet FS-2026-13 (verified 2026-11-13).

States with no individual income tax on wages (9)

In these states there is no state income tax on overtime to begin with, so the conformity question is moot. The federal deduction is the only income-tax break at stake; FICA still applies.

• Alaska — 0% — no wage income tax
• Florida — 0% — no wage income tax
• Nevada — 0% — no wage income tax
• New Hampshire — 0% — no wage income tax
• South Dakota — 0% — no wage income tax
• Tennessee — 0% — no wage income tax
• Texas — 0% — no wage income tax
• Washington — 0% — no wage income tax
• Wyoming — 0% — no wage income tax

States with a flat income tax (15)

One rate applies to every dollar of taxable income, so the state-side arithmetic is simple once you know whether the state allows the deduction.

• Arizona — 2.5%
• Colorado — 4.4%
• Georgia — 5.19%
• Idaho — 5.3%
• Illinois — 4.95%
• Indiana — 2.95%
• Iowa — 3.8%
• Kentucky — 3.5%
• Louisiana — 3%
• Michigan — 4.25%
• Mississippi — 4%
• North Carolina — 3.99%
• Ohio — 2.75%
• Pennsylvania — 3.07%
• Utah — 4.5%

States with graduated brackets (26)

Rates shown are 2026 top marginal rates. Your own marginal rate is usually lower — every calculator on this site lets you edit it.

• Alabama — 5%
• Arkansas — 3.9%
• California — 13.3%
• Connecticut — 6.99%
• Delaware — 6.6%
• Hawaii — 11%
• Kansas — 5.58%
• Maine — 7.15%
• Maryland — 6.5%
• Massachusetts — 9%
• Minnesota — 9.85%
• Missouri — 4.7%
• Montana — 5.65%
• Nebraska — 4.55%
• New Jersey — 10.75%
• New Mexico — 5.9%
• New York — 10.9%
• North Dakota — 2.5%
• Oklahoma — 4.5%
• Oregon — 9.9%
• Rhode Island — 5.99%
• South Carolina — 6%
• Vermont — 8.75%
• Virginia — 5.75%
• West Virginia — 4.82%
• Wisconsin — 7.65%

FAQ

Is overtime tax-free in every state?

No. The federal deduction is nationwide, but only nine states impose no income tax on wages at all. In the other 41 states and D.C., the same overtime may still be taxed unless the state conformed to the federal provision.

Which states have no income tax on overtime pay?

Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas and Wyoming levy no individual income tax. Washington has no tax on wages (its 9% excise tax applies only to large capital gains). Workers in these nine states owe no state income tax on overtime regardless of conformity.

Why doesn't this site publish a list of which states conform?

Conformity depends on whether a state starts from federal AGI or federal taxable income, on its IRC conformity date, and on that state's own legislation. We have not verified any state's current position against a first-party source, so we do not publish a list or assert a status. Verify with your state tax agency (IRS list of state government websites) before filing; sources last checked 2026-11-12.

Does the deduction apply to state payroll or local taxes?

No. §225 reduces income tax only. Social Security and Medicare are unchanged, and city or county income taxes follow their own rules.

What years does the deduction cover?

Tax years 2025 through 2028. For 2025, use pay stubs or payroll records (IRS Notice 2025-69); from 2026, qualified overtime appears on W-2 Box 12 with code "TT", or on 1099-MISC box 14 / 1099-NEC box 1d. Box 12 shows the total paid, not the deductible amount, and for tax years after 2025 you may not claim more than the amount reported to you (IRS Fact Sheet FS-2026-13, Q10 / Q20, verified 2026-11-13).

Start with the federal calculator

If you only want the federal §225 math — the 0.5× premium, the $12,500 / $25,000 caps, and the MAGI phase-out — use the federal no-tax-on-overtime calculator.

Where to start

Begin with the federal No Tax on Overtime Calculator to get your federal deduction, then choose your state below for its 2026 rate and the state-level question the headlines skip. Tips are a separate deduction with its own cap and eligibility rules — use the No Tax on Tips Calculator for those.

A five-state pilot of the tips deduction (California, New York, Texas, Florida and Nevada) is also available on the tips deduction by state index.