Deductible Overtime Hours
Deductible overtime hours are the hours that employees can deduct from their overtime pay for tax purposes. The tax deduction only applies to the overtime premium portion of pay required under the Federal Fair Labor Standards Act (FLSA), aka FLSA-qualified overtime compensation (QOC). Example of FLSA Qualified Overtime Compensation(QOC): Employee’s regular rate is $20/hr Overtime rate is $30/hr (20×1.5=30) The QOC would be $10/hr premium, aka, the extra half-time portion (the .5x premium) of the total overtime rate. **Applicable only to businesses paying workers in the United States. The number of deductible hours may differ from the total number of…