Rendered before/after
That's because being an exempt or non-exempt hourly employee under the FLSA has never been a tax issue and most tax accountants don't really know or have not gone down the rabbit hole far enough to see that UPS drivers are exempt employees under the FLSA, due to Motor Carrier Exemption, as stated in the law, and are thus ineligible for the no tax on OT. We are FLSA exempt employees.
Motor Carrier Exemption
https://www.transportation.gov/civil-rights/civil-rights-library/motor-carrier-exemption-under-fair-labor-standards-act-flsa
And the law states for tax years 2025 through 2028, individuals who receive qualified overtime compensation may deduct the pay that exceeds their regular rate of pay (generally, the “half” portion of “time-and-a-half” compensation) that is required by the Fair Labor Standards Act.
https://www.irs.gov/newsroom/treasury-irs-provide-guidance-for-individuals-who-received-tips-or-overtime-during-tax-year-2025
UPS is not required to pay us OT under the FLSA because we are exempt from the FLSA under the Motor Carrier Exemption. So our OT is not deductible.
Have your tax guy dig a little deeper and see what he says.
Well, he did dig deeper. And says we still qualify for a portion of it. As well as he has received memos from the IRS saying this is a transition year and the likelihood of an Auto being triggered by this is very unlikely.
But again that’s why I pay him the big bucks and I don’t do it myself.
For the record, this wasn’t any kind of windfall at all lol.
That's because being an exempt or non-exempt hourly employee under the FLSA has never been a tax issue and most tax accountants don't really know or have not gone down the rabbit hole far enough to see that UPS drivers are exempt employees under the FLSA, due to Motor Carrier Exemption, as stated in the law, and are thus ineligible for the no tax on OT. We are FLSA exempt employees.
Motor Carrier Exemption
https://www.transportation.gov/civil-rights/civil-rights-library/motor-carrier-exemption-under-fair-labor-standards-act-flsa
And the law states for tax years 2025 through 2028, individuals who receive qualified overtime compensation may deduct the pay that exceeds their regular rate of pay (generally, the “half” portion of “time-and-a-half” compensation) that is required by the Fair Labor Standards Act.
https://www.irs.gov/newsroom/treasury-irs-provide-guidance-for-individuals-who-received-tips-or-overtime-during-tax-year-2025
UPS is not required to pay us OT under the FLSA because we are exempt from the FLSA under the Motor Carrier Exemption. So our OT is not deductible.
Have your tax guy dig a little deeper and see what he says.
Well, he did dig deeper. And says we still qualify for a portion of it. As well as he has received memos from the IRS saying this is a transition year and the likelihood of an Audit being triggered by this is very unlikely.
But again that’s why I pay him the big bucks and I don’t do it myself.
For the record, this wasn’t any kind of windfall at all lol.