This episode provides essential financial advice for tipped employees and those who work overtime, breaking down the IRS guidance on the taxability of these earnings under the new regulations. We dive into the specific rules for tipped workers, including which occupations qualify for the deduction, the $25,000 limit, and the new Schedule 1A form that will affect tax returns. Additionally, we clarify the tricky calculation for deducting overtime pay, emphasizing that only the "premium" part of the overtime wage is deductible and that state-specific daily overtime rules may not qualify unless 40 hours were worked, offering actionable insights for individuals and small business employees relying on professional accounting services for compliance.
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🎙️ Kaizen Time is part of the Blood, Sweat & Business podcast series by Kaizen CPAs + Advisors. We help small business owners make smarter financial decisions—without the fluff.
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