Updated October 28, 2026. Quick answer: If you or your spouse earned qualified overtime from more than one employer in 2025, this short worksheet in the Form 1040 instructions adds up the qualified part from each employer’s Form W-2. The total goes on Schedule 1-A line 14a. Qualified overtime is the ‘half’ in time-and-a-half, not the whole overtime paycheck.
More on the 2026 tax figures: the 2026 overtime deduction.
More on the 2027 tax figures: the 2027 overtime deduction.
When you use it
“If you and/or your spouse received qualified overtime compensation from more than one employer in 2025, complete the Qualified Overtime Compensation From More Than One Employer Worksheet.” It feeds line 14a of Schedule 1-A. Overtime from contract work reported on Form 1099 goes on line 14b and the payor worksheet.
The worksheet
Line 1 has a row for each of up to five employers, A to E, and two columns.
| Column or line | What the worksheet says |
|---|---|
| (a) | “Name of employer” |
| (b) | “Qualified overtime reported on Form W-2, box 1” |
| Line 2 | “Add the amounts from lines 1A through 1E, column (b), and enter this amount on Schedule 1-A, line 14a” |
On the form, line 14a is captioned “Qualified overtime compensation included in Form W-2, box 1.” Line 15 then applies the cap: “Enter the smaller of the amount on line 14c or $12,500 ($25,000 if married filing jointly)”.
What counts as qualified overtime
“Qualified overtime compensation means overtime compensation that is paid to you as required under section 7 of the Fair Labor Standards Act of 1938 (FLSA) that is more than the amount of your regular rate of pay.” “This generally means the “half” portion of “time-and-a-half” compensation that is required by the FLSA.”
The instructions give an example of how to back the amount out of a total. Example 1 is an FLSA-eligible employee, and it says “In 2025, you received $50,000 in regular pay and $15,000” for overtime hours, with no separate qualified overtime figure on the Form W-2. The instructions conclude that you can include $5,000 because “The $5,000 is the “half” portion of “time-and-a-half” ($15,000 divided by 3).” For public safety employees on a special rule, Example 4 gives the same $15,000 divided by 3, and for compensatory time at one and one-half hours Example 5 turns $4,500 into $1,500.
Line 14a: only the overtime part of box 1
“Enter on line 14a only the qualified overtime compensation amount that is included on Form W-2.” The W-2 box 1 total includes regular wages, so the worksheet column holds only the qualified part, which some employers show in box 14.
An example with invented numbers
Illustration, not an IRS example. A worker has qualified overtime of $3,200 from one employer and $2,100 from another.
| Employer | Column (b) |
|---|---|
| A: Employer A (invented) | $3,200 |
| B: Employer B (invented) | $2,100 |
| Line 2, computed: 3,200 + 2,100, to Schedule 1-A line 14a | $5,300 (computed) |
The $5,300 total is the amount for line 14a. It is not reduced here for the cap or the income limits; those apply in Part III of the schedule.
The limits that still apply
The instructions cap the deduction and reduce it at higher incomes. “You can’t deduct more than $12,500 ($25,000 if married filing jointly) of qualified overtime compensation.” The capped amount is reduced when modified adjusted gross income, the Schedule 1-A line 3 amount, is above $150,000 for single, head of household or qualifying surviving spouse filers, or above $300,000 for married filing jointly. “If you are married, you must file a joint return with your spouse to claim this deduction.”
Edition
This page reads the Instructions for Form 1040 and 1040-SR (2025), the file irs.gov served on 2026-10-28 (sha256 in the kit data). It covers the 2025 return, filed in 2026. Check the tax year printed on the worksheet in your own copy and use that year’s line numbers and dollar amounts, because a different year’s worksheet can word its lines differently.
Common mistakes
- Entering the full overtime pay. Only the half portion of time-and-a-half, which the FLSA requires, is qualified.
- Entering your whole W-2 box 1 amount. Box 1 includes regular wages.
- Putting 1099 overtime on this worksheet. Contract overtime has its own worksheet and goes to line 14b.
- Including overtime that your state or union contract requires beyond the FLSA. The instructions say that premium pay above time-and-a-half is not qualified.
Related: W-2 box 1, W-2 box 14, Form 1040-X lines 4a to 5, and payor worksheet.
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Answer againSources
- Instructions for Form 1040 and 1040-SR (2025): https://www.irs.gov/pub/irs-pdf/i1040gi.pdf
- Schedule 1-A (Form 1040) (2025), Additional Deductions: https://www.irs.gov/pub/irs-pdf/f1040s1a.pdf
Read from the IRS documents linked above on October 28, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the account provider or the IRS is the right place to confirm anything consequential.