Senate bill would let workers deduct overtime pay from federal taxes
In committeeS. 4310Latest action
Sponsor: James C. Justice · Senator · WV
AIDecoded by AI · checked against the recordRead the official text
Official title: No Tax on Overtime for All Workers Act
119th Congress
Topics: Jobs & the economy
Introduced:
Read the official bill on Congress.govIn plain words
The plain-language version comes first. The official text is always the reference.
S 4310 would make overtime wages tax-deductible for federal income tax starting Jan. 1, 2025, but payroll taxes would still apply.
50-second read · 4 questions answered below
What does this do?
S 4310 would create a new federal income specifically for overtime earnings, so workers would not owe federal income tax on wages earned beyond their normal hours. Under current law, overtime wages are taxed the same as regular wages. The deduction would apply to tax years beginning January 1, 2025.
Who does it affect?
The bill covers hourly workers entitled to overtime under federal labor law after 40 hours in a week, as well as workers covered by formal employer agreements such as union contracts. Railroad and airline workers, whose schedules fall under a separate federal law, are specifically included in the second group.
Why does it matter?
Workers who regularly put in overtime hours would retain a larger share of those earnings because federal income tax would no longer apply to that portion of their wages. Payroll taxes for Social Security and Medicare would still be owed on overtime pay, limiting the scope of the tax relief.
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Read the official bill on Congress.govMake the call
Where does it stand?
- IntroducedApr 15, 2026
- Senate committeeYou are here · Apr 15, 2026
- Senate vote
- House
- The president's desk
Right now: a Senate committee is reviewing it. If the House changes it, it goes back to the Senate before reaching the president.
Latest action: — Read twice and referred to the Committee on Finance.