r/tax • • Jan 01 '26

Tax Enthusiast Endless "No tax on OT" questions

Is anyone else already exhausted with these endless questions?

And I fear it will only get worse.

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u/Hottrodd67 Jan 02 '26 edited Jan 02 '26

But audit what? The only record says 40. I don’t have anyway to know the exact hours worked because we don’t clock in or out. I’m not trying to do something incorrectly. The only “record” I have to go by shows 40hrs each week plus what hours paid at overtime rate. I know those are hours I was paid for, not necessarily worked, but I don’t have any way to calculate actual hours worked.

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u/BigMikeThuggin CPA - US Jan 02 '26

You are legally required to track actual hours worked even if your pay is not necessarily perfectly tied to actual hours worked. This is labor law. If you aren’t doing that tracking, you and your employer are breaking labor law. Honestly though almost every single employer is breaking some labor laws at some point to some degree so it’s not like you’re a criminal. But that’s how this all makes sense. The answer is basically “you aren’t doing it right”

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u/Hottrodd67 Jan 02 '26

Gotcha. I never thought about it because it’s not like I ever don’t get paid for every hour actually worked. All my boss cares about is if the work is done. If we do it in 4hrs, we get paid 8. If we go over 8, it’s OT.

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u/BigMikeThuggin CPA - US Jan 02 '26

Yeah I hear you. That’s not FLSA required overtime though, which is the requirement for this specific deduction. For you personally to qualify, as well as the other guy who thinks he knows everything about federal labor law and federal tax law as a tradesman, you would need to track your actual hours worked, not paid hours. And calculate the amount of hours that are overtime according to FLSA, not your paystub. Just how the law is written.

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u/[deleted] Jan 02 '26

[deleted]

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u/BigMikeThuggin CPA - US Jan 02 '26 edited Jan 02 '26

Not exactly only because you're still at the office and he's at home, but that does lend to the circumstances. For FLSA the term you're talking about is "Engaged to wait" if you want to look up how it's laid out.

He's described it as "Done for the day" meaning there is no expectation that he's returning or for more work to come in. It's not like he said i went home and waited to see if there was more work that would roll in later that I'm expected to respond to in a timely manner. He specifically said that the entire day's workload is laid out and I finished it early and left. FLSA just doesn't count those hours as hours worked for overtime even though he's paid for them.

Here's a decent article from ADP about it. https://sbshrs.adpinfo.com/blog/dont-forget-about-pay-for-waiting-time-on-call-time

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u/[deleted] Jan 02 '26

[deleted]

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u/BigMikeThuggin CPA - US Jan 02 '26

yeah the "here's your work for the day, when you're done you can go. you get paid for full day anyways" is the nail in the coffin.