Overtime Pay Calculator

How the Overtime Pay Calculator: Gross and Take-Home Pay Works

Overtime pay adds up fast, but the extra hours are taxed like any other income, so the take-home amount is less than the gross overtime rate. This overtime pay calculator computes your gross pay for a week that includes overtime or double-time hours, then estimates the after-tax value using your approximate salary to find your marginal tax bracket.

Enter your regular hourly rate, hours worked, and any overtime or double-time hours, along with your approximate annual salary and filing status, to see the result.

How overtime pay is calculated

Under the federal Fair Labor Standards Act, covered non-exempt employees earn at least one and a half times their regular rate for hours worked over 40 in a workweek. The regular rate is not always just the hourly wage; it should include most non-discretionary bonuses and shift differentials for the week, divided by total hours, which can make the true overtime rate slightly higher than 1.5 times the base wage alone.

Some states require daily overtime after 8 hours, and California and a few others require double time after 12 hours in a day or on the seventh consecutive day worked in a week. This calculator lets you enter overtime and double-time hours directly so you can model either federal or state rules.

Only hours actually worked count toward the 40-hour threshold; paid holidays and vacation generally do not, under federal law.

Why overtime feels heavily taxed

Overtime pay is ordinary income and is not taxed at a special higher rate by law. What creates the feeling of heavy taxation is that payroll withholding systems annualize each paycheck; a week with a lot of overtime looks, for withholding purposes, like every week pays that much, which pushes that paycheck's withholding into a higher bracket than your true average rate.

When you file your return, all your income for the year, regular and overtime combined, is taxed using the annual brackets, so any over-withholding from a big overtime week is refunded or reduces your balance due. This calculator estimates tax using your marginal rate on your approximate annual salary, which is closer to your real bracket than a payroll system's per-paycheck annualization.

New federal law also provides a temporary deduction for the overtime premium (the extra half-time portion) for income tax purposes, up to a limit and phasing out at higher incomes; see the tips and overtime deduction calculator on this site for that specific benefit.

Fluctuating workweek and other special pay methods

Some employers use the fluctuating workweek method for salaried non-exempt employees, paying a fixed weekly salary for all hours worked plus an extra 0.5 times the regular rate for overtime hours, rather than 1.5 times. This is legal under specific conditions set by the Department of Labor, including a clear mutual understanding that the salary covers all hours worked, whatever the number.

If your pay stub shows an overtime calculation method you don't recognize, ask payroll to explain it and compare it against the FLSA rules or your state's specific overtime law, since the fluctuating workweek method and other alternatives are not always legal in every state.

Comparing overtime across a full pay period

If you're paid biweekly or semimonthly, overtime is still calculated on a workweek basis (a fixed 7-day period), not the full pay period, so a two-week check can include overtime from each of the two separate workweeks within it, calculated independently. Use this calculator once per workweek and add the results together to estimate a full pay period that includes overtime in both weeks.

Exempt versus non-exempt status

Whether you're entitled to overtime at all depends on exempt status, not job title. Non-exempt employees, generally most hourly workers and many lower-paid salaried workers, must receive overtime under FLSA rules. Exempt employees, who must meet both a minimum salary threshold and a duties test for executive, administrative, professional or certain other categories, are not entitled to federal overtime. If you're paid a salary below roughly $35,568 a year, you are very likely non-exempt regardless of your job duties or title, and overtime should still be calculated and paid.

If you regularly work over 40 hours and are unsure of your status, check your job duties against the Department of Labor's fact sheets or ask your state labor department, since misclassification is a common wage and hour violation.

Overtime for tipped and commissioned employees

Tipped employees' overtime is calculated on the full minimum wage (or applicable state minimum), not the lower tipped cash wage, and the tip credit the employer claims stays the same per hour; only the base rate used for the overtime premium increases. This is a frequently miscalculated area, and many wage claims involve incorrect overtime calculations for tipped restaurant and hospitality workers.

Commissioned employees who are non-exempt must have commissions included in their regular rate for overtime purposes, similar to non-discretionary bonuses, which often means a retroactive true-up calculation once total commissions for a period are known, since commissions are frequently paid after the workweek in which they were earned.

State-by-state overtime quick reference

California and Alaska require daily overtime after 8 hours and double time after 12. Colorado requires daily overtime after 12 hours or weekly after 40, whichever is greater for the employee. Nevada requires daily overtime for employees earning below one and a half times the state minimum wage. Most other states, including Texas, Florida, Georgia and the Midwest and Northeast states not listed here, follow the federal 40-hour weekly standard with no daily overtime requirement.

Always verify current rules with your state labor department, since these thresholds and qualifying conditions are updated periodically and vary by industry in some states, particularly for agricultural, healthcare and unionized workers who sometimes fall under separate rules.

Worked example

A worker earning $22 an hour works 48 hours in a week: 40 regular and 8 overtime. Regular pay is $880, overtime pay is 8 times $33 (1.5 times $22), or $264, for total gross pay of $1,144. Assuming a $52,000 approximate annual salary puts this worker in the 12% federal bracket, so estimated federal tax is about $137, Social Security and Medicare are $87.57, and state tax at 5% is $57.20, leaving an estimated net pay around $862 for the week.

Compare that with a week of only 40 regular hours ($880 gross), where the same rates would apply proportionally, showing that the 8 overtime hours added about $200 to take-home pay after tax, roughly $25 an hour after tax versus the $33 gross overtime rate.

Common overtime mistakes to check for

Make sure your regular rate used for overtime includes eligible bonuses and shift differentials for the week, not just your base hourly wage, since excluding them understates the overtime rate. Check that your employer is using the correct daily or weekly threshold for your state. Confirm that time worked before or after a shift, required training, and certain travel time are being counted as hours worked.

If you are salaried and non-exempt (paid a salary but still eligible for overtime, which is common for salaries below the exemption threshold or for jobs that don't meet the duties test), your regular rate is your weekly salary divided by the hours it's intended to cover, and overtime is still owed on top.

If your pay stub doesn't clearly separate regular and overtime pay and hours, ask payroll for a breakdown, and keep your own timesheet records to compare.

Overtime Pay results at a glance

These are the calculator's results at different values of regular hourly rate, with every other input left at the example values above (the bold row is the example). Use them to see how quickly the result changes before entering your own numbers.

How filing status changes the result

The same example with each filing status option:

The same example at different state tax rates

State income tax is the input that varies most between readers. Nine states charge 0% on wages, flat-tax states charge one rate, and progressive states charge more at higher incomes. Here is the example at five effective state rates; for your exact state rules, use the state paycheck calculators.

What changing regular hours this week does

Holding everything else at the example values, here is the effect of regular hours this week:

Overtime pay at common hourly rates

These are gross amounts before tax. Most workers keep about 70% to 80% of overtime pay after federal tax and FICA, before state tax and before the federal overtime deduction claimed on the return.

Check overtime eligibility and the limits of this estimate

For covered, nonexempt employees, federal overtime generally starts after 40 hours in a workweek at 1.5 times the regular rate. Regular rate can include nondiscretionary bonuses. Check Department of Labor Fact Sheet 23 and applicable state rules.

The calculator uses an approximate marginal income tax rate and a flat payroll tax estimate. It does not account for reaching the Social Security wage base, Additional Medicare Tax or the qualified overtime deduction. Use the qualified overtime deduction calculator separately; eligibility is not determined by this page.