---
kind: "section"
citation: "26 U.S.C. § 225"
title: "26"
title_heading: "Internal Revenue Code"
number: "225"
heading: "Qualified overtime compensation"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/26/225"
units:
  - "Subtitle A — Income Taxes"
  - "Chapter 1 — Normal Taxes and Surtaxes"
  - "Subchapter B — Computation of Taxable Income"
  - "Part VII — Additional Itemized Deductions for Individuals"
---

# §225. Qualified overtime compensation

- (a) **In general—** There shall be allowed as a deduction an amount equal to the qualified overtime [compensation](/usc/26/414.md?p=n-5-C-iii) received during the taxable year and included on statements furnished to the individual pursuant to section [6041(d)(4)](/usc/26/6041.md?p=d-4) or [6051(a)(19)](/usc/26/6051.md?p=a-19).
- (b) **Limitation—**
  - (1) **In general—** The amount allowed as a deduction under this section for any taxable year shall not exceed $12,500 ($25,000 in the case of a [joint return](/usc/26/62.md?p=b-3-D)).
  - (2) **Limitation based on adjusted gross income—**
    - (A) **In general—** The amount allowable as a deduction under [subsection (a)](#a) (after application of [paragraph (1)](#b-1)) shall be reduced (but not below zero) by $100 for each $1,000 by which the [taxpayer](/usc/26/1313.md?p=b)’s modified [adjusted gross income](/usc/26/62.md?p=a) exceeds $150,000 ($300,000 in the case of a [joint return](/usc/26/62.md?p=b-3-D)).
    - (B) **Modified adjusted gross income—** For purposes of this paragraph, the term “modified [adjusted gross income](/usc/26/62.md?p=a)” means the [adjusted gross income](/usc/26/62.md?p=a) of the [taxpayer](/usc/26/1313.md?p=b) for the taxable year increased by any amount excluded from gross income under section [911](/usc/26/911.md), [931](/usc/26/931.md), or 933.
- (c) **Qualified overtime compensation—**
  - (1) **In general—** For purposes of this section, the term “qualified overtime [compensation](/usc/26/414.md?p=n-5-C-iii)” means overtime [compensation](/usc/26/414.md?p=n-5-C-iii) paid to an individual required under section 7 of the Fair Labor Standards Act of 1938 that is in excess of the regular rate (as used in such section) at which such individual is employed.
  - (2) **Exclusions—** Such term shall not include any qualified tip (as defined in [section 224(d)](/usc/26/224.md?p=d)).
- (d) **Social security number required—**
  - (1) **In general—** No deduction shall be allowed under this section unless the [taxpayer](/usc/26/1313.md?p=b) includes on the return of tax for the taxable year such individual’s social security number.
  - (2) **Social security number defined—** For purposes of [paragraph (1)](#d-1), the term “social security number” shall have the meaning given such term in [section 24(h)(7)](/usc/26/24.md?p=h-7).
- (e) **Married individuals—** If the [taxpayer](/usc/26/1313.md?p=b) is a married individual (within the meaning of [section 7703](/usc/26/7703.md)), this section shall apply only if the [taxpayer](/usc/26/1313.md?p=b) and the [taxpayer](/usc/26/1313.md?p=b)’s spouse file a [joint return](/usc/26/62.md?p=b-3-D) for the taxable year.
- (f) **Regulations—** The Secretary shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section, including regulations or other guidance to prevent abuse of the deduction allowed by this section.
- (g) **Termination—** No deduction shall be allowed under this section for any taxable year beginning after December 31, 2028.

## Source credit

(Added Pub. L. 119–21, title VII, § 70202(a), July 4, 2025, 139 Stat. 174.)

## Notes

### Editorial Notes

### References in Text

Section 7 of the Fair Labor Standards Act of 1938, referred to in subsec. (c)(1), is classified to section 207 of Title 29, Labor.

### Prior Provisions

A prior section 225 was renumbered section 226 of this title.

### Statutory Notes and Related Subsidiaries

### Effective Date

Section applicable to taxable years beginning after Dec. 31, 2024, see section 70202(g) of Pub. L. 119–21, set out as an Effective Date of 2025 Amendment note under section 63 of this title.