No Tax on Overtime Calculator for Nurses
Nurses are among the hardest-working professionals in America — and overtime is a way of life. Under the OBBBA 2026 overtime tax deduction, you may deduct the FLSA overtime premium (typically ½ × regular rate × OT hours) on Schedule 1-A — up to $12,500 ($25,000 joint) for tax years 2025–2028 — not your full overtime paycheck. Whether you're an RN pulling double shifts or an LPN picking up extra hours, use this calculator to see exactly how much you keep.
Your Nurse Overtime Tax Calculator
Pre-filled with typical values for nurses. Adjust to match your actual earnings.
Your Annual Tax Savings
Tax Notes for Nurses
- Under the FLSA, nurses working over 40 hours per week must be paid at 1.5× their regular rate for every overtime hour — and the FLSA overtime premium on those hours may qualify for a Schedule 1-A deduction under the OBBBA (cap $12,500 / $25,000 joint).
- FICA taxes (6.2% Social Security + 1.45% Medicare) still apply to your overtime earnings — only federal income tax is reduced by the deduction.
- The OBBBA overtime deduction applies to W-2 employees only. Travel nurses paid as 1099 contractors do not qualify for this specific deduction.
- Mandatory overtime, voluntary overtime, and shift differentials that push you past 40 hours all count as qualifying overtime under the FLSA.
- You must still report all overtime income on your tax return — the deduction is applied as a deduction, not an exclusion from reporting.
Three Calculation Examples for Nurses
Part-Time OT — Staff Nurse
A staff RN at a community hospital picking up 8 hours of overtime per week at 1.5× rate ($48/hr OT). Gross OT pay: $18,432 · Qualified premium ≈ $6,144 (Schedule 1-A; cap $12,500 single / $25,000 joint — not full OT exempt).
Regular OT — Hospital RN
An experienced RN at a major hospital working 12 hours of overtime per week at 1.5× rate ($57/hr OT). Annual overtime pay: $34,200 — significant savings at the 22% federal bracket.
Heavy OT — ICU Nurse
A senior ICU nurse working 16 hours of overtime per week at 1.5× rate ($67.50/hr OT). Annual overtime pay: $54,000 — saving over $11,000 in federal income tax.
Frequently Asked Questions
Does my nursing overtime qualify for the OBBBA deduction?
Yes. Any hours worked beyond 40 per week that are compensated at overtime rates (typically 1.5×) qualify for the federal income tax deduction under the OBBBA. This includes mandatory overtime, voluntary extra shifts, and holiday overtime — as long as you are a W-2 employee.
What about double-time pay for holiday shifts?
Double-time pay (2×) for holidays or special shifts also qualifies as overtime compensation under the OBBBA, provided the hours exceed 40 for the workweek. Even if the employer pays 2× or higher, only the FLSA-required half-premium is usually qualified overtime compensation (IRS FS-2026-13).
Does holiday pay count as overtime under the OBBBA?
Holiday premium pay only qualifies if the total hours in the workweek exceed 40. Simply receiving a higher rate for working on a holiday does not automatically make it overtime. The FLSA defines overtime as hours worked beyond 40 in a 7-day workweek.
I'm a travel nurse — does the overtime deduction apply to me?
It depends on your employment classification. If you are a W-2 employee of a staffing agency working over 40 hours per week, your overtime qualifies. If you are classified as a 1099 independent contractor, the OBBBA overtime deduction does not apply to your earnings. Check your employment status with your agency.
Related Tools and Resources
Use the full No Tax on Overtime Calculator for any profession. Also check the No Tax on Tips Calculator if you also earn tips, and the OBBBA FAQ for answers on eligibility, filing, and FICA taxes.
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