Latest news with #overtimepay
News.com.au
19-07-2025
- Business
- News.com.au
‘Unfair': Labor reveals penalty rates protection as priority when parliament returns
Pay for workers in female, part time and under-35 dominated industries will be the target of some of the first new laws under the new federal government. On Saturday, Employment Minister Amanda Rishworth announced laws to protect penalty rates and overtime pay for 2.6 million workers would be introduced in the coming weeks. 'If you rely on the modern award safety net and work weekends, public holidays, early mornings or late nights, you deserve to have your wages protected,' Ms Rishworth said. 'We want this law passed as a top priority, so workers are protected from the loopholes that see their take-home pay go backwards.' People covered by award rates are more likely to be women, work part time, be under 35 years of age or employed on casual contracts, Ms Rishworth said. The proposed law would add rules to the Fair Work Act, so penalty rates and overtime cannot be rolled up into a single rate of pay where it leaves any individual worker worse off. Speaking in Canberra on Saturday, Ms Rishworth stood alongside retail workers who said their penalty rates were 'really important' in paying for groceries and school fees. Retail worker Daniel said he was paid about $85 in penalty rates each week, equalling $4240 a year. 'I've been in retail for 17 years … That money often pays for vets, dentists, doctors and food. 'Generally, I find living on six to $700 a week is a struggle, whether you've got a partner to rely on or not. 'Penalty rates honestly make a huge difference, and without it, I'd have to work more. See my family less, see my dog less, see my friends less,' he said. 'Just not go to the movies, not ever have a holiday. It's a myriad of things that would affect me.' Ms Rishworth said the new legislation was prompted by 'a number of cases' where penalty rates were being reduced 'in an unfair way'. Retail, clerical and banking sector companies had made moves to trade away penalty rates for lower-paid workers, she said, leaving those staff worse off. 'Enterprise bargaining is the appropriate place to negotiate on entitlements – not eroding the award safety net,' Ms Rishworth said. Labor needs only the support of the Greens in the senate to pass legislation, sidelining the other minor parties and independents who held sway in the previous parliament's upper house.
Globe and Mail
10-07-2025
- Business
- Globe and Mail
What to know -- and what isn't known yet -- about US tax deductions for tips and overtime pay
Millions of U.S. workers who earn tips and overtime pay may be eligible for a federal tax break when they file their 2025 income taxes next year. But which workers will qualify for the new deductions is among the details the government has to work out after President Donald Trump's signature spending and policy package won final congressional approval. Under the bill Trump signed into law on July 4, the U.S. Treasury Department must publish a list by Oct. 2 of occupations that qualify for tax-free tips. The department is also expected to publish guidance on how to report tips and overtime pay, and what documentation will be required. The deduction provisions are not permanent but were written to expire after the 2028 tax year. Overtime pay isn't currently separated out on an employee's W-2 tax form, for example, but employers generally keep track of it and itemize it on employees' pay stubs, said Miguel Burgos, a certified public accountant with TurboTax. Employers should continue to withhold taxes while waiting for guidance, Burgos said. The bill doesn't apply to state and local taxes or to federal payroll taxes, which help fund Social Security and Medicare. Here's what we know about tax-free tips and overtime: Who is expected to qualify for tax-free tips? The bill says eligible workers are those who already regularly received tips before December 2024. In the restaurant industry alone, there are 2.1 million tipped servers and bartenders, according to the National Restaurant Association. Barbers, hairdressers, nail technicians and delivery drivers are also expected to be included. Workers must include a Social Security number when they file their taxes to be eligible, and a spouse's Social Security number if they're married and filing jointly. How much will eligible workers be able to deduct? Workers will be able to deduct up to $25,000 in tips if they make less than $150,000 (or $300,000 if they're married and filing jointly). The amount workers can deduct is reduced by $100 for every $1,000 they make over $150,000. Who will see the most benefit from not paying federal taxes on tips? The change will not affect around 40% of tipped workers since they already pay little to no income tax, according to the nonpartisan Tax Policy Center. The other 60% of tipped workers are expected to see an average tax cut of $1,800 per year. What kinds of tips will be counted? Both cash tips and credit cards are included. Tips pooled together and then distributed to a restaurant's employees are also included, although servers may be less inclined to participate in tip pooling now that they are eligible for a tax deduction. Service charges – such as an automatic gratuity for a large party – aren't included because the bill makes clear that eligible tips must be 'paid voluntarily.' Who will be eligible for tax-free overtime? The Budget Lab at Yale estimates that 8% of U.S. hourly workers and 4% of salaried workers are regularly paid overtime under the Fair Labor Standards Act, which requires overtime pay of at least time and a half once employees have worked 40 hours in a week. People working in many jobs, including clergy, teachers and executives, are exempt from federal overtime rules. How much in overtime can workers deduct from their federal taxes? Workers can deduct up to $12,500 in overtime (or up to $25,000 in a joint return). Like the tip measure, the amount workers can deduct is reduced if they make more than $150,000. And they must include a Social Security number when they file. How much of a tax cut is an overtime deduction likely to yield? The average worker is expected to see a tax cut of between $1,400 and $1,750 per year, according to the White House Council of Economic Advisers. According to an analysis by the nonpartisan Joint Committee on Taxation, tax-free tips would reduce federal revenue by $31 billion between the 2026 and 2029 fiscal years, while tax-free overtime would reduce federal revenue by $90 billion during the same period.
Washington Post
10-07-2025
- Business
- Washington Post
What to know -- and what isn't known yet -- about US tax deductions for tips and overtime pay
Millions of U.S. workers who earn tips and overtime pay may be eligible for a federal tax break when they file their 2025 income taxes next year. But which workers will qualify for the new deductions is among the details the government has to work out after President Donald Trump's signature spending and policy package won final congressional approval .
Al Arabiya
10-07-2025
- Business
- Al Arabiya
What to know -- and what isn't known yet -- about US tax deductions for tips and overtime pay
Millions of US workers who earn tips and overtime pay may be eligible for a federal tax break when they file their 2025 income taxes next year. But which workers will qualify for the new deductions is among the details the government has to work out after President Donald Trump's signature spending and policy package won final congressional approval. Under the bill Trump signed into law on July 4, the US Treasury Department must publish a list by Oct. 2 of occupations that qualify for tax-free tips. The department is also expected to publish guidance on how to report tips and overtime pay and what documentation will be required. The deduction provisions are not permanent but were written to expire after the 2028 tax year. Overtime pay isn't currently separated out on an employee's W-2 tax form for example, but employers generally keep track of it and itemize it on employees' pay stubs, said Miguel Burgos, a certified public accountant with TurboTax. Employers should continue to withhold taxes while waiting for guidance, Burgos said. The bill doesn't apply to state and local taxes or to federal payroll taxes, which help fund Social Security and Medicare. Here's what we know about tax-free tips and overtime: Who is expected to qualify for tax-free tips? The bill says eligible workers are those who already regularly received tips before December 2024. In the restaurant industry alone, there are 2.1 million tipped servers and bartenders according to the National Restaurant Association. Barbers, hairdressers, nail technicians, and delivery drivers are also expected to be included. Workers must include a Social Security number when they file their taxes to be eligible and a spouse's Social Security number if they're married and filing jointly. How much will eligible workers be able to deduct? Workers will be able to deduct up to 25000 in tips if they make less than 150000 (or 300000 if they're married and filing jointly). The amount workers can deduct is reduced by 100 for every 1000 they make over 150000. Who will see the most benefit from not paying federal taxes on tips? The change will not affect around 40 percent of tipped workers since they already pay little to no income tax according to the nonpartisan Tax Policy Center. The other 60 percent of tipped workers are expected to see an average tax cut of 1800 per year. What kinds of tips will be counted? Both cash tips and credit cards are included. Tips pooled together and then distributed to a restaurant's employees are also included although servers may be less inclined to participate in tip pooling now that they are eligible for a tax deduction. Service charges – such as an automatic gratuity for a large party – aren't included because the bill makes clear that eligible tips must be paid voluntarily. Who will be eligible for tax-free overtime? The Budget Lab at Yale estimates that 8 percent of US hourly workers and 4 percent of salaried workers are regularly paid overtime under the Fair Labor Standards Act, which requires overtime pay of at least time and a half once employees have worked 40 hours in a week. People working in many jobs, including clergy, teachers, and executives, are exempt from federal overtime rules. How much in overtime can workers deduct from their federal taxes? Workers can deduct up to 12500 in overtime (or up to 25000 in a joint return). Like the tip measure, the amount workers can deduct is reduced if they make more than 150000. And they must include a Social Security number when they file. How much of a tax cut is an overtime deduction likely to yield? The average worker is expected to see a tax cut of between 1400 and 1750 per year according to the White House Council of Economic Advisers. According to an analysis by the nonpartisan Joint Committee on Taxation, tax-free tips would reduce federal revenue by 31 billion between the 2026 and 2029 fiscal years, while tax-free overtime would reduce federal revenue by 90 billion during the same period.
The Independent
10-07-2025
- Business
- The Independent
What to know -- and what isn't known yet -- about US tax deductions for tips and overtime pay
Millions of U.S. workers who earn tips and overtime pay may be eligible for a federal tax break when they file their 2025 income taxes next year. But which workers will qualify for the new deductions is among the details the government has to work out after President Donald Trump's signature spending and policy package won final congressional approval. Under the bill Trump signed into law on July 4, the U.S. Treasury Department must publish a list by Oct. 2 of occupations that qualify for tax-free tips. The department is also expected to publish guidance on how to report tips and overtime pay, and what documentation will be required. The deduction provisions are not permanent but were written to expire after the 2028 tax year. Overtime pay isn't currently separated out on an employee's W-2 tax form, for example, but employers generally keep track of it and itemize it on employees' pay stubs, said Miguel Burgos, a certified public accountant with TurboTax. Employers should continue to withhold taxes while waiting for guidance, Burgos said. The bill doesn't apply to state and local taxes or to federal payroll taxes, which help fund Social Security and Medicare. Here's what we know about tax-free tips and overtime: Who is expected to qualify for tax-free tips? The bill says eligible workers are those who already regularly received tips before December 2024. In the restaurant industry alone, there are 2.1 million tipped servers and bartenders, according to the National Restaurant Association. Barbers, hairdressers, nail technicians and delivery drivers are also expected to be included. Workers must include a Social Security number when they file their taxes to be eligible, and a spouse's Social Security number if they're married and filing jointly. How much will eligible workers be able to deduct? Workers will be able to deduct up to $25,000 in tips if they make less than $150,000 (or $300,000 if they're married and filing jointly). The amount workers can deduct is reduced by $100 for every $1,000 they make over $150,000. Who will see the most benefit from not paying federal taxes on tips? The change will not affect around 40% of tipped workers since they already pay little to no income tax, according to the nonpartisan Tax Policy Center. The other 60% of tipped workers are expected to see an average tax cut of $1,800 per year. What kinds of tips will be counted? Both cash tips and credit cards are included. Tips pooled together and then distributed to a restaurant's employees are also included, although servers may be less inclined to participate in tip pooling now that they are eligible for a tax deduction. Service charges – such as an automatic gratuity for a large party – aren't included because the bill makes clear that eligible tips must be 'paid voluntarily.' Who will be eligible for tax-free overtime? The Budget Lab at Yale estimates that 8% of U.S. hourly workers and 4% of salaried workers are regularly paid overtime under the Fair Labor Standards Act, which requires overtime pay of at least time and a half once employees have worked 40 hours in a week. People working in many jobs, including clergy, teachers and executives, are exempt from federal overtime rules. How much in overtime can workers deduct from their federal taxes? Workers can deduct up to $12,500 in overtime (or up to $25,000 in a joint return). Like the tip measure, the amount workers can deduct is reduced if they make more than $150,000. And they must include a Social Security number when they file. How much of a tax cut is an overtime deduction likely to yield? The average worker is expected to see a tax cut of between $1,400 and $1,750 per year, according to the White House Council of Economic Advisers. According to an analysis by the nonpartisan Joint Committee on Taxation, tax-free tips would reduce federal revenue by $31 billion between the 2026 and 2029 fiscal years, while tax-free overtime would reduce federal revenue by $90 billion during the same period.
