[Generated Title]: States Rebel Against Trump's "No Tax on Overtime" BS. Who's Gonna Pay?
Okay, so Trump's "One Big Beautiful Bill" (OBBB) – give me a freakin' break with that name – included this "no tax on overtime" thing. Sounds great, right? More money in your pocket. Except, surprise surprise, it's not that simple.
The Great Overtime Heist (or, Deduction)
Basically, the OBBB said you wouldn't have to pay federal income tax on overtime, up to a point. $12,500 for singles, $25,000 for married couples. And it went into effect retroactively, starting January 1, 2025. So, everyone who's been grinding away, thinking they'd get a little break... well, hold your horses.
Because here's where the states come in to ruin everything. Washington D.C., New York, Illinois, Colorado – they're all saying "nah, we're good." They're passing laws to basically ignore the federal tax break and still tax your overtime. Why? Protecting their budgets, offcourse. When did Trump's no tax on overtime start? Check list of states where it doesn't apply.
So, wait a minute. We're supposed to be celebrating this tax break, but a bunch of states are just like, "Thanks, but no thanks, we need your money more."
Is this some kind of sick joke?
The IRS's "Oops, We Messed Up" Moment
And it gets better. The IRS is basically throwing its hands up in the air, saying they won't penalize employers for screwing up the reporting requirements for this whole "no tax on tips" and "no tax on overtime" mess for 2025. They're admitting they didn't give employers any guidance on how to even calculate the qualified overtime compensation. Like, seriously?
They expect employers to figure out what counts as "qualified overtime" and how to report it when the people in charge have no clue. It's like asking a toddler to perform brain surgery.
The IRS "encouraged" employers to give employees an accounting of their cash tips and qualified overtime, but admitted that they may not have the information or systems in place to provide it. What?
So, let me get this straight: Trump makes a big promise, the IRS botches the implementation, and the states swoop in to grab the cash. Meanwhile, the people actually working overtime are left scratching their heads, wondering if they're getting screwed.
Who's Really Benefiting Here?
It feels like this whole thing was designed to fail. A flashy headline, a half-baked plan, and a whole lot of confusion. And who benefits? Certainly not the average worker busting their ass for that extra paycheck. Maybe it's the accountants who get paid to sort out this mess. Maybe it's the politicians who get to posture about tax cuts while quietly undermining them.
I don't know, man. Maybe I'm just too cynical.
So, Who's Gonna Get Mugged?
This whole "no tax on overtime" thing is a bait-and-switch. Trump made a promise, but the states are welching on the deal, and the IRS is throwing up their hands. The only guarantee is that someone, somewhere, is getting screwed. And I have a sneaking suspicion it's the people who can least afford it.
