Bill > HR561

This bill provides a new tax deduction for overtime compensation for workers, allowing individuals to deduct up to 20 percent of their overtime pay from their taxable income, with specific income-based limitations. The deduction applies to overtime compensation as defined by the Fair Labor Standards Act, which typically means pay at a rate higher than an employee's regular hourly wage for hours worked beyond a standard 40-hour workweek. The bill caps the deduction based on adjusted gross income: $200,000 for married couples filing jointly, $150,000 for heads of household, and $100,000 for other individuals. The deduction is temporary, available only for overtime payments received between the bill's enactment and December 31, 2029. The legislation modifies the Internal Revenue Code to create this new tax benefit, ensuring that the deduction can be claimed by both itemizers and non-itemizers, and requires the Treasury Department to update withholding tables and procedures to reflect the new deduction. The goal appears to be providing financial relief to workers who earn extra income through overtime and potentially incentivizing employers to offer more overtime opportunities.

Budget and Finance

https://www.congress.gov/bill/119th-congress/house-bill/561/all-info