W-2 overtime

[Opfor77]

I'm confused.  Here goes:

Client's W-2 box 1 = $70,857.

Box 14 is empty.

Client's pay stub shows overtime pay (at time and a half) of $30,352.

I go to W-2 input, Part VII (Deductible overtime) and enter the following:

14a is no.

14c total overtime at 150% is $30,352, making the calculated deductible amount of $10,117 (30,352/3).

Is this correct?

[Just-Lisa-Now-]

Thats exactly what Ive been doing.

[Terry53029]

Yes it is correct. $30352/3 = $10117.

[IRonMaN]

I don't think this has been updated for awhile - 3,233,567

[TaxGuyBill]

Is it all QUALIFYING overtime?

You need to ask the client if they only receive overtime for working over 40 hours in a week, or if they receive overtime for other reasons.

Some unions and some states (California) result in overtime for other reasons, such as working over a certain number of hours in a day, regardless of how many hours worked in a week.  You can only deduct the overtime required by the FLSA, which means only overtime paid for working over 40 hours in a week (certain jobs under the FLSA have slightly different rules than 40 hours in a week).

[Skylane]

Next year will be easier when employers are requiring to follow the law and report on W2 (rather than making up their own rules as they think it should apply)

[IRonMaN]

I didn't sign up to be the OT police so I am not interrogating anybody about their OT hours.  I'm just happy when they can make it to my office with their W-2 intact.  To be honest, the vast majority of my clients that had overtime during the year had employers that provided the OT premium amount ------ I was a tad surprised.

[Skylane]

Seems like those ERs using major payroll companies (ADP, Paychex,….) do it right… smaller companies… not so much

[TaxGuyBill]

---

@IRonMaN wrote:

I didn't sign up to be the OT police so I am not interrogating anybody about their OT hours. 

---

At least where I live, there are enough unions around that pay overtime differently so I need to ask about the 40 hours.  But I don't interrogate them to find out if they are covered by FLSA unless they have some unusual job.

We don't know where the OP lives, but if they live in California, I think the total overtime on the pay stub is pretty much useless because of California's laws on overtime.

[IRonMaN]

Plenty of unions here too.  But the good thing is, I have been fortunate that most of those clients have employers that were ahead of the game and provided the needed detail.   I did have a couple of clients come in with W-2s from time they spent as extras on movie sets.  I believe they both had W-2s of something like $132 with $8 in overtime.  I just kinda ignored that overtime.  😁