Schedule 1-A Part III, line by line
Qualified overtime from W-2s on line 14a and other statements on 14b, the cap on line 15, then the MAGI phase-out on lines 16–21.
The lines
- Line 14a: qualified overtime reported on Form W-2 (box 12 code TT from 2026; for 2025, box 14, a separate statement or your own figure). 14b: from Form 1099 or other statements. 14c: the total.
- Line 15: the smaller of 14c and $12,500 ($25,000 joint).
- Lines 16–20: MAGI, the $150,000 or $300,000 threshold, the excess, the excess ÷ $1,000 rounded down, times $100.
- Line 21: line 15 minus line 20, not below zero.
Line numbers follow the 2025 form; check the 2026 form when it's out.
Worked example
The app's sample is a fictional nurse filing single with a modified AGI of $158,400 and two jobs. At the hospital her timecards show 95 hours over 40, with shift differentials and bonuses in the regular rate: $2,120.84 of premium by her own count. The hospital's W-2 code TT says $1,900.00, so Overtally uses that and flags the gap. The staffing agency's pay stub shows $6,600 of time-and-a-half pay, so $2,200.00 qualifies (÷ 3), and a 38-hour week with California-style daily overtime counts $0. Total qualified overtime is $4,100.00 (line 14c). MAGI is $8,400 over $150,000, so the deduction drops by 8 × $100 = $800, leaving $3,300.00 on Schedule 1-A line 21.
Your pay stays on your computer
Overtally reads your timecards with JavaScript in this browser tab. Nothing is uploaded, and closing the tab clears it.
How it works
- List your workweeks in the template (or any CSV or Excel sheet): employer, hours, hourly rate and any bonus or differential — or a pay stub total or the W-2 code TT figure. Drop it here, or try the sample.
- Pick the tax year and filing status and type your MAGI, then read the deduction, Schedule 1-A lines 14–21 and every check.
- Compare with your W-2 box 12 code TT and copy the lines onto Schedule 1-A.
FAQ
Is my data uploaded?
No. Your files are read by JavaScript in your browser tab and never sent to us or anyone else. Timecards and pay figures aren't stored, so closing the tab clears them. Settings can be saved in this browser.
What does Overtally do?
It reads your weekly hours and rates (or pay stub and W-2 figures), works out the qualified overtime for each workweek and each employer under IRC §225 and IRS Notice 2025-69, applies the $12,500 cap and the MAGI phase-out, and fills in Schedule 1-A lines 14–21 for 2025 through 2028.
What overtime counts?
Only the premium the Fair Labor Standards Act requires for hours over 40 in a workweek — the “half” of time-and-a-half, at the FLSA regular rate. The base pay for those hours, daily overtime under state law, overtime a union contract pays beyond the FLSA, and overtime paid to FLSA-exempt employees don't count.
How is the phase-out worked out?
$100 for each full $1,000 of modified AGI over $150,000 ($300,000 married filing jointly). A part of $1,000 doesn't count (Schedule 1-A line 19 rounds down). Married filing separately can't take the deduction.
What's free?
Importing any number of weeks and jobs, the deduction, Schedule 1-A lines 14–21, every check, the first 8 rows and the first employer on screen and in print (with a footer). Pro shows and prints everything and exports the Excel workbook and both CSVs.
My W-2 code TT doesn't match my weeks. Which is right?
For 2026 and later your employer must report qualified overtime in box 12 code TT. Overtally uses the employer figure when you enter it and shows your own weekly total next to it. If they differ, ask payroll; a wrong W-2 is fixed with a W-2c.
What isn't covered?
State taxes, tipped income (a separate deduction), salaried exempt jobs, and the 2026 form's line numbers if they change. Your W-2 and a tax professional come first.
Is this tax advice?
No. Overtally applies the rules it describes to the numbers you provide. It is a worksheet to check against your employer's figures.