⏱️ Overtime Pay Calculator & Guide 2026

Overtime pay is 1.5x your regular rate for hours over 40 per week under federal law — but the rules around who qualifies, how it's calculated, and how much you actually keep after taxes are more nuanced than most people realize. This guide walks through the full FLSA overtime framework, shows you exactly how to calculate overtime pay for your situation, and covers the key state-level differences that affect millions of workers.

How Overtime Pay is Calculated

The federal formula is straightforward: your overtime rate is 1.5× your regular hourly rate for all hours worked over 40 in a single workweek.

Who Qualifies for Overtime? Exempt vs Non-Exempt

The FLSA divides workers into two categories:

Non-Exempt Employees (entitled to overtime)

• Most hourly workers regardless of pay rate
• Salaried employees earning under $684/week ($35,568/year)
• Many salaried workers whose primary duties are manual, clerical, or non-managerial

Exempt Employees (no overtime requirement)

To be exempt, an employee generally must meet both a salary threshold AND a duties test:

• Executive exemption: Manages the company or a department, supervises 2+ employees, has authority over hiring/firing
• Administrative exemption: Office/non-manual work, exercises genuine discretion on matters of business significance
• Professional exemption: Work requires advanced knowledge in a field of science or learning (doctors, lawyers, engineers, CPAs, teachers)
• Highly Compensated Employee (HCE): Earns $107,432/year+ and customarily performs at least one exempt duty

Overtime by State — Key Differences (2026)

Federal law sets the floor; states can (and do) provide additional protections. The most significant state-level differences:

California's daily overtime rule is particularly impactful for shift workers. An employee working four 10-hour days (40 hours total) earns 8 hours of overtime in California — even though total weekly hours don't exceed 40.

How Overtime Affects Your Taxes

One of the most common misconceptions: overtime is not taxed at a special higher rate. All income is subject to the same progressive federal brackets. What happens in practice:

• Your overtime earnings are added to your regular income for the pay period
• If the combined amount pushes you into the next bracket, that portion of overtime is taxed at the higher marginal rate
• Your W-4 withholding may result in higher withholding on overtime checks — but this is just an estimate, not a separate rate
• At year-end, all income is taxed together across the brackets — no separate "overtime tax"

Calculating Overtime for Salaried Non-Exempt Employees

If you're a salaried non-exempt employee (earning under $35,568/year), your overtime rate is calculated from your effective hourly rate:

1. Divide your weekly salary by the number of hours it's intended to cover (usually 40)
2. Multiply that hourly rate by 1.5 to get your overtime rate
3. Multiply the overtime rate by hours worked over 40

Example: Salary of $600/week ÷ 40 hours = $15/hour regular rate. OT rate = $22.50/hour. 5 overtime hours = $112.50 in OT pay added to the $600 base.

Double Time — When Does It Apply?

Double time (2× regular rate) is not required under federal law — but California mandates it in two situations:

• Hours worked beyond 12 in a single workday
• Hours worked beyond 8 on the 7th consecutive day of work in a workweek

Outside California, double time is a voluntary employer policy — often offered on holidays or for extreme overtime hours, but not legally required.