Tips & Overtime Deduction Estimator
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How the phase-out is applied. The law and Schedule 1-A reduce each deduction on its own: $100 per full $1,000 of MAGI over $150,000 ($300,000 joint), separately for tips (lines 7 to 13) and overtime (lines 15 to 21). Sources and example.
Result
$0Total estimated deduction
$0Tips deduction (line 13)
$0Overtime deduction (line 21)
—Illustrative tax effect (deduction × your rate)
| Line | Item | Amount |
|---|
The tax effect is an illustration only, not a refund or savings estimate. Not tax advice.
What this estimator does not check
- Whether your occupation is on the IRS tipped occupation list.
- Whether your amounts really are qualified tips or qualified overtime (see our tips and overtime guides).
- Self-employed tips: the statute limits them to income from that business after its allocable deductions; the tool uses the net profit you type (Schedule 1-A line 5).
- State taxes.
Self-employed tips and overtime paid to non-employees (Forms 1099) have details we did not verify. Use Schedule 1-A instructions.
Sources
- IRS: One Big Beautiful Bill Act tax deductions for working Americans and seniors (FS-2025-03) (accessed October 17, 2026)
- IRS: Schedule 1-A (Form 1040), 2025 (accessed October 17, 2026)
- 26 U.S.C. § 224, Qualified tips (Cornell LII) (accessed October 17, 2026)
- 26 U.S.C. § 225, Qualified overtime compensation (Cornell LII) (accessed October 17, 2026)
Last verified: October 17, 2026. Deductions apply to tax years beginning after 2024 and ending before 2029.