I 
119TH CONGRESS 
1ST SESSION 
H. R. 561 
To amend the Internal Revenue Code of 1986 to establish a deduction 
for certain overtime payments. 
IN THE HOUSE OF REPRESENTATIVES 
JANUARY 20, 2025 
Mr. BACON introduced the following bill; which was referred to the Committee 
on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to establish 
a deduction for certain overtime payments. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Overtime Pay Tax Re-
lief Act of 2025’’. 
SEC. 2. DEDUCTION FOR OVERTIME COMPENSATION. 
(a) IN GENERAL.— 
(1) DEDUCTION ALLOWED.—Part VII of sub-
chapter B of chapter 1 of the Internal Revenue Code 
of 1986 is amended by redesignating section 224 as 
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section 225 and by inserting after section 223 the 
following new section: 
‘‘SEC. 224. OVERTIME COMPENSATION. 
‘‘(a) IN GENERAL.—There shall be allowed as a de-
duction an amount equal to so much of any overtime com-
pensation received by an individual as does not exceed 20 
percent of such individual’s other wages from the same 
employer for the taxable year. 
‘‘(b) OVERTIME COMPENSATION.—For purposes of 
this section, the term ‘overtime compensation’ means over-
time compensation required under section 7 of the Fair 
Labor Standards Act of 1938. 
‘‘(c) LIMITATION.—No deduction shall be allowed 
under subsection (a) for any taxpayer whose adjusted 
gross income for the taxable year exceeds— 
‘‘(1) in the case of a married couple filing joint-
ly, $200,000, 
‘‘(2) in the case of a head of household, 
$150,000, or 
‘‘(3) in the case of any other individual, 
$100,000. 
‘‘(d) TERMINATION.—No deduction shall be allowed 
under subsection (a) for any amounts received after De-
cember 31, 2029.’’. 
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(2) CONFORMING AMENDMENT.—The table of 
sections for part VII of subchapter B of chapter 1 
of such Code is amended by redesignating the item 
relating to section 224 as relating to section 225 
and by inserting after the item relating to section 
223 the following new item: 
‘‘Sec. 224. Overtime payments.’’. 
(b) DEDUCTION ALLOWED
TO NON-ITEMIZERS.— 
Section 63(b) of the Internal Revenue Code of 1986 is 
amended by striking ‘‘and’’ at the end of paragraph (3), 
by striking the period at the end of paragraph (4) and 
inserting ‘‘and’’, and by adding at the end the following 
new paragraph: 
‘‘(5) the deduction provided in section 224.’’. 
(c) NON-APPLICATION
OF CERTAIN LIMITATIONS 
FOR ITEMIZERS.— 
(1) DEDUCTION NOT TREATED AS A MISCELLA-
NEOUS ITEMIZED DEDUCTION.—Section 67(b) of the 
Internal Revenue Code of 1986 is amended by strik-
ing ‘‘and’’ at the end of paragraph (11), by striking 
the period at the end of paragraph (12) and insert-
ing ‘‘, and’’, and by adding at the end the following 
new paragraph: 
‘‘(13) the deduction under section 224 (relating 
to overtime compensation).’’. 
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(2) DEDUCTION
NOT
TAKEN
INTO
ACCOUNT 
UNDER OVERALL LIMITATION.—Section 68(c) of the 
Internal Revenue Code of 1986 is amended by strik-
ing ‘‘and’’ at the end of paragraph (2), by striking 
the period at the end of paragraph (3) and inserting 
‘‘, and’’, and by adding at the end the following new 
paragraph: 
‘‘(4) the deduction under section 224 (relating 
to overtime compensation).’’. 
(d) WITHHOLDING.—The Secretary of the Treasury 
(or the Secretary’s delegate) shall modify the tables and 
procedures prescribed under section 3402(a) of the Inter-
nal Revenue Code of 1986 to take into account the deduc-
tion allowed under section 224 of such Code (as added 
by this Act). 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to amounts received after the date 
of the enactment of this Act. 
Æ 
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