Quick Answer
OT or OVERTIME on your pay stub shows hours worked beyond 40 per week at time-and-a-half pay (1.5x your regular rate). If you earn $20/hour regularly, overtime pays $30/hour. This appears separately because it's taxed the same as regular income but calculated differently.
Best Answer
Sarah Chen, Payroll Tax Analyst
Best for anyone who works hourly and occasionally puts in extra hours
What overtime means on your pay stub
OT or OVERTIME on your pay stub represents hours worked beyond the standard 40-hour work week, paid at time-and-a-half (1.5 times your regular hourly rate). This appears as a separate line item because employers must track and report overtime hours differently, even though it's taxed the same as regular income.
Example: How overtime pay is calculated
Let's say you earn $20 per hour and work 45 hours in one week:
On your pay stub, you'll see:
How overtime affects your taxes
Overtime is taxed exactly the same as regular income — it's not taxed at a higher rate. However, because it increases your total paycheck amount, it might push you into a higher withholding bracket for that specific paycheck. This is just withholding, not your actual tax rate.
For example, if your regular $800 weekly paycheck has $120 withheld for federal taxes (15%), your $950 overtime paycheck might have $160 withheld (16.8%) due to withholding tables. You'll get any excess back when you file your tax return.
Key factors that determine overtime eligibility
Common overtime variations on pay stubs
What you should do
Always verify your overtime calculations match your timesheet. Multiply your overtime hours by 1.5 times your regular rate. If the numbers don't match, bring it up with payroll immediately — overtime miscalculations are common and legally required to be corrected.
Use our paystub explainer tool to upload your actual pay stub and get a detailed breakdown of all line items, including overtime calculations.
Key takeaway: Overtime pay is 1.5x your regular hourly rate for hours over 40 per week and appears separately on your pay stub, but it's taxed the same as regular income.
*Sources: [Fair Labor Standards Act (FLSA)](https://www.dol.gov/agencies/whd/flsa), [IRS Publication 15](https://www.irs.gov/pub/irs-pdf/p15.pdf)*
Key Takeaway: Overtime is paid at 1.5x your regular rate for hours over 40 per week and is taxed the same as regular income, just tracked separately.
Overtime rates for different base pay levels
| Regular Hourly Rate | Overtime Rate (1.5x) | Extra Earnings Per OT Hour |
|---|---|---|
| $12.00 | $18.00 | $6.00 more |
| $15.00 | $22.50 | $7.50 more |
| $20.00 | $30.00 | $10.00 more |
| $25.00 | $37.50 | $12.50 more |
| $30.00 | $45.00 | $15.00 more |
More Perspectives
Sarah Chen, Payroll Tax Analyst
Perfect for someone seeing overtime on their pay stub for the first time
Getting overtime for the first time? Here's what's happening
Seeing "OT" or "OVERTIME" on your first few paychecks can be exciting but confusing. This means you worked more than 40 hours in a week and earned extra money at a higher rate.
The basic math is simple
If you normally make $15/hour, your overtime rate is $22.50/hour ($15 × 1.5). So if you worked 43 hours one week:
Why it shows up separately
Your employer has to track overtime separately by law. The Fair Labor Standards Act requires time-and-a-half pay for most hourly workers, and the Department of Labor audits this. Keeping it on a separate line makes compliance easier.
Don't worry about "higher taxes"
A common myth is that overtime is "taxed more." It's not. Overtime is taxed exactly like regular income. Your paycheck just looks different because:
1. More total income means more total taxes withheld
2. Payroll systems sometimes withhold conservatively on larger checks
3. You'll get any excess back at tax time
What to watch for
Double-check that your overtime hours match what you actually worked. If you worked 43 hours but only see 41 regular hours and 2 overtime hours, that's a mistake that costs you money.
Key takeaway: Overtime is a good thing — you're earning 50% more per hour for those extra hours, and it's not taxed any differently than your regular pay.
Key Takeaway: Overtime means you're earning 50% more per hour for extra work, and despite common myths, it's taxed the same as regular income.
Sarah Chen, Payroll Tax Analyst
For salaried workers who see unexpected overtime pay due to reclassification or special circumstances
When salaried employees get overtime pay
If you're typically salaried but see overtime on your pay stub, your employer likely reclassified you as non-exempt, or you're in a special situation where salaried employees still qualify for overtime.
Common scenarios for salaried overtime
Recent rule changes: The Department of Labor periodically raises the salary threshold for overtime exemption. In 2026, if you're salaried but earn less than $58,656 annually ($1,128/week), you're entitled to overtime regardless of your job duties.
Misclassification correction: Your employer may have discovered you were incorrectly classified as exempt and is now paying retroactive overtime.
Temporary hourly assignment: Some companies switch salaried employees to hourly during busy periods to manage labor costs.
How it's calculated differently
For salaried employees newly eligible for overtime, your "regular rate" is calculated by dividing your weekly salary by 40 hours. If you earn $52,000/year ($1,000/week), your regular rate is $25/hour, making overtime $37.50/hour.
What this means for your taxes
Overtime pay is treated as regular W-2 income. However, if you receive a large lump sum of retroactive overtime, it might push you into a higher tax bracket for that pay period's withholding. Consider adjusting your W-4 temporarily or making estimated tax payments if the amount is substantial.
Key takeaway: Salaried employees earning under $58,656 annually are entitled to overtime pay, calculated based on their effective hourly rate from their salary.
Key Takeaway: Salaried employees under $58,656 annually qualify for overtime, with rates calculated by dividing weekly salary by 40 hours.
Sources
- Fair Labor Standards Act (FLSA) — Federal law governing overtime pay requirements
- IRS Publication 15 — Employer's Tax Guide for payroll tax withholding
Related Questions
Reviewed by Sarah Chen, Payroll Tax Analyst on February 28, 2026
This content is for educational purposes only and is not a substitute for professional tax advice. Consult a qualified tax professional for advice specific to your situation.