• H.R. 5475 No Tax On Overtime
    Posted On: Oct 24, 2025

    As most are aware, the no tax on overtime bill  was passed into law on July 4, 2025, and it egregiously omitted a sizable portion of the workforce in this country.  The bill does not change the amount of overtime pay an eligible employee receives on their regular paycheck.  Rather, it is provided in the form of a federal tax deduction for up to $12,500 ($25k for joint filers) applied to your annual tax return. The law was passed as an amendment to the Fair Labor Standards Act (FLSA), which does not apply to any employee covered under a collective bargaining agreement (CBA).  Why were we omitted?  There were several reasons, not the least of which was an intentional attack on organized labor in this country.  Organized labor leaders had previously secured commitments from members in both chambers of Congress to add an amendment to include the millions of Union workers in the bill.  However, as you may recall, there was a feverish push toward passage so the bill could be signed into law on Independence Day.  As a result of that maneuver, the initiative did not receive enough Congressional support to be put to a vote in either chamber and the bill was passed without amendments, leaving us out.

    However, through persistent work by the legislative departments of various rail labor Unions, and others, a new bill was introduced in Congress on September 18th.  That bill is H.R. 5475 and, if enacted, will extend the Federal tax deduction on overtime to those covered under a CBA.  The new bill was sponsored by Rep. Malliotakis (NY) and includes 5 co-sponsors from both sides of the aisle.  We are tracking the progress of that bill and will advise when/if it becomes time for all of us to reach out to our representatives in Washington to encourage their support.  Since it is a tax bill, it has been referred to the House Ways and Means Committee for consideration.  If you happen to live in a district with a member on that committee, it would be a good idea to proactively reach out to your Congressman/woman
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