Overtime pay is calculated by multiplying the regular hourly rate by 1.5 for every hour worked over 40 in a workweek, as the U.S. Fair Labor Standards Act (FLSA) requires for non-exempt employees. At $20 an hour, a 50-hour week pays 40 × $20 + 10 × $30 = $1,100.
The rest of this guide covers the formula step by step, a rate table you can look up, what changes when a bonus or a salary is involved, state rules that go beyond the federal minimum, and how overtime is taxed.
What is the overtime pay formula?
For a standard hourly worker, three steps are enough:
- Regular pay = regular rate × hours up to 40.
- Overtime rate = regular rate × 1.5 (time and a half).
- Overtime pay = overtime rate × hours over 40.
Total pay = regular pay + overtime pay.
The federal rule applies per workweek, a fixed recurring period of 168 hours (seven consecutive 24-hour periods). Hours are not averaged across two weeks: 30 hours one week and 50 the next means 10 overtime hours, not zero. See how many hours are in a week for the 168-hour count.
Worked example: $20 an hour, 45 hours
- Regular pay: 40 × $20 = $800
- Overtime rate: $20 × 1.5 = $30
- Overtime pay: 5 × $30 = $150
- Total: $950, an average of $21.11 per hour worked
Overtime that is paid at time and a half is also called "time and a half"; hours at twice the rate are double time.
What does overtime pay at different hourly rates and hours?
Weekly gross pay for a non-exempt employee at time and a half after 40 hours (federal rule, before any tax):
| Hourly rate | Overtime rate | 45 hours | 50 hours | 55 hours | 60 hours |
|---|---|---|---|---|---|
| $15 | $22.50 | $712.50 | $825.00 | $937.50 | $1,050.00 |
| $18 | $27.00 | $855.00 | $990.00 | $1,125.00 | $1,260.00 |
| $20 | $30.00 | $950.00 | $1,100.00 | $1,250.00 | $1,400.00 |
| $25 | $37.50 | $1,187.50 | $1,375.00 | $1,562.50 | $1,750.00 |
| $30 | $45.00 | $1,425.00 | $1,650.00 | $1,875.00 | $2,100.00 |
| $40 | $60.00 | $1,900.00 | $2,200.00 | $2,500.00 | $2,800.00 |
Each row is calculated as 40 × rate + (hours − 40) × rate × 1.5. The same pattern gives any rate: every overtime hour is worth 1.5 regular hours, so 10 overtime hours equal 15 straight-time hours of pay.
How does a bonus change the overtime rate?
The FLSA defines the regular rate as including all remuneration for employment except certain payments the law excludes, and discretionary bonuses are among those exclusions. A bonus that is promised or based on production or attendance is therefore part of the regular rate, which makes the overtime rate higher.
The method, as the U.S. Office of Personnel Management lays it out, has five steps: find the straight-time rate, add up total remuneration for the week, divide by total hours worked to get the regular rate, pay the straight-time rate for all hours, then add half the regular rate for each overtime hour.
Worked example: $20 an hour, 48 hours, $100 attendance bonus
- Straight-time pay for all hours: 48 × $20 = $960
- Total remuneration: $960 + $100 = $1,060
- Regular rate: $1,060 ÷ 48 = $22.08
- Overtime premium: 8 hours × ($22.08 ÷ 2) = $88.33
- Total pay: $1,060 + $88.33 = $1,148.33
Without the bonus the same week pays $960 + 8 × $10 = $1,040. Counting the bonus in the regular rate adds $8.33 of extra overtime.
Worked example: two pay rates in one week
An employee works 30 hours at $18 and 20 hours at $24, 50 hours in all.
- Total straight-time pay: 30 × $18 + 20 × $24 = $540 + $480 = $1,020
- Weighted regular rate: $1,020 ÷ 50 = $20.40
- Premium for 10 overtime hours: 10 × $10.20 = $102
- Total pay: $1,122
How do salaried non-exempt employees get overtime?
The Department of Labor states that a fixed salary for a regular workweek longer than 40 hours does not discharge FLSA obligations. For a non-exempt employee, the salary is turned into an hourly rate first.
Example: a $52,000 salary, paid for all hours worked, with a 45-hour week.
- Weekly salary: $52,000 ÷ 52 = $1,000
- If the salary covers only 40 hours: rate = $1,000 ÷ 40 = $25; overtime = 5 × $37.50 = $187.50; total = $1,187.50
- If the salary is meant to cover all 45 hours: regular rate = $1,000 ÷ 45 = $22.22; the owed extra is 5 × $11.11 = $55.56; total = $1,055.56
Which version applies depends on the pay agreement and the state, so treat the table above as the default and check the employment terms. To turn a salary into an hourly figure, see how to calculate hourly rate from salary.
Which states have rules beyond the federal minimum?
The federal threshold is 40 hours a week, and federal law sets no limit on how many hours employees aged 16 and older may work. Some states add daily rules. In California, according to the state's Department of Industrial Relations:
- Hours 9 through 12 in a workday: 1.5 times the regular rate
- Hours past 12 in a workday: double the regular rate
- Seventh consecutive day: the first 8 hours at 1.5 times, beyond that at double time
Example, California, $25 an hour, one 14-hour day: 8 × $25 + 4 × $37.50 + 2 × $50 = $200 + $150 + $100 = $450.
Check the state labor department for the exact rules where you work.
How is overtime taxed?
Overtime is wages. It is subject to income tax withholding, Social Security (6.2% for the employee in 2026, on wages up to $184,500) and Medicare (1.45%, no wage base limit).
Withholding versus the tax you owe
IRS Publication 15 lists overtime pay among supplemental wages, but employers can choose to treat overtime as regular wages. If they withhold at the flat supplemental rate, the rate is 22%. On $600 of overtime, that is $132 of income tax withholding plus $45.90 of Social Security and Medicare (7.65%).
Withholding is only an advance. The tax actually owed is set by total annual income and the bracket rates, and overtime does not get taxed at a higher rate than other pay. A bigger check can look like it is taxed more because withholding is estimated for a full paycheck, and any difference is settled when the return is filed.
The 2025–2028 federal overtime deduction
For tax years 2025 through 2028, qualified overtime compensation is deductible. Only the premium counts: the extra pay above the regular rate, which is the "half" in time and a half. The IRS states the deduction is capped at $12,500 ($25,000 for joint filers), is available whether or not the filer itemizes, and phases out above $150,000 of modified adjusted gross income ($300,000 joint). Under 26 U.S.C. § 225, the deduction shrinks by $100 for each $1,000 above the threshold.
Example, single filer at $22 an hour: 8 overtime hours a week for 50 weeks.
- Premium: 8 × 50 × ($22 × 0.5) = $4,400
- With $80,000 modified AGI: deduction = $4,400
- A different filer with $20,000 of premium and $155,000 modified AGI: capped at $12,500, reduced by 5 × $100 = $500, so $12,000
- With $200,000 modified AGI: $12,500 − 50 × $100 = $7,500
- With $275,000 modified AGI or more: $0
The deduction lowers income tax only, not Social Security or Medicare tax. The paycheck calculator shows how take-home pay changes with extra hours, and the overtime calculator shows the deductible premium for a week.
Common mistakes
- Averaging hours across weeks. Federal overtime is counted per workweek.
- Using the base rate when a bonus is promised. Nondiscretionary bonuses raise the regular rate.
- Multiplying the whole week by 1.5. Only hours over 40 get the premium.
- Assuming a salary means no overtime. Non-exempt employees are owed overtime whether paid hourly or by salary.
- Treating the deduction as a refund of all overtime tax. It covers only the premium and only income tax.
This guide is educational, not tax, legal or payroll advice; exemptions, state rules and agreements vary.