Taxation of Tips and Overtime Under OBBBA
Overview
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Arguably the most discussed topics to come out of the One Big Beautiful Bill Act (OBBBA) are the taxation of tips and overtime. Practitioners need to understand these provisions now, as they are effective for 2025 tax returns. This program provides practitioners with the background currently available to advise clients regarding these two important tax developments. Both employers and employees need to understand these timely changes to taxation.Highlights
- $12,500 deduction per individual for qualified overtime pay
- Payment of overtime under the Fair Labor Standards Act (FLSA)
- Calculating the “premium portion” of the extra half-time pay
- Social Security and Medicare withholding
- Employer furnishing the record of qualified overtime compensation to employees
- Definition of a qualified tip
- IRS list of traditionally-tipped occupations
- $25,000 deduction for reported tips
- The transition rule allowing employers to indicate the approximate amount designated as tips or overtime
- State tax issues relating to tips and overtime
- Changes in the W-2 reflecting new employer reporting responsibilities
Prerequisites
None
Designed For
All accounting and finance practitioners
Objectives
- Expertly advise clients regarding the latest on taxation of tips and overtime emanating from OBBBA
Preparation
None
Leader(s):
Leader Bios
John Kilroy
John Kilroy is a managing member of iValue Financial Planning LLC, located in the Philadelphia, Pennsylvania area. John engages clients in financial and tax planning, as well as preparing tax returns for individuals, corporations, partnerships, estates, and trusts. John is a CPA and a CFP® practitioner. He is a 1979 graduate of Villanova University with a BS in Accounting. John is a member of the Pennsylvania Institute of Certified Public Accountants and the Financial Planning Association (FPA). Within the FPA, John has served as a board member of the Philadelphia Tri-State chapter and on its education and finance committees. John is an adjunct faculty member for the Temple University Certificate of Financial Planning Program. He is a frequent speaker and facilitator on tax and financial planning topics. John has been quoted in the Wall Street Journal, MarketWatch.com, and USATODAY.com. He has written for the Journal of Financial Planning, and is a contributor to Retirement Weekly. John has also discussed financial and tax planning issues on various radio outlets.
Non-Member Price $140.00
Member Price $115.00