Estimate the new federal deductions on Schedule 1-A for tax years 2025–2028, with every step of the math shown.
Education, not tax advice. This is a free estimate tool from Solo Paycheck. It does not file anything or know your full tax situation. Confirm with the official IRS instructions or a tax professional before you file. Nothing you type leaves your browser.
RECHECK The rules below follow the law and the 2025 Schedule 1-A. When the IRS releases the final 2026 Schedule 1-A and instructions, every rule and figure on this page must be rechecked against them.
Married? You must file jointly to claim either deduction.More detailsSchedule 1-A, Parts II–III cautions · 26 U.S.C. §224For most people, this is the AGI on Form 1040 line 11b.More detailsIt also adds back any excluded foreign or Puerto Rico income. Schedule 1-A, Part IFind it on your W-2, box 12, code TP.More detailsMore than one W-2? Add their code TP amounts together. If you got tips as a contractor, use the tip amount included in 1099-NEC box 1, 1099-MISC box 3 or 1099-K box 1a (it can't be more than that business's net profit). If you report tips on Form 4137, follow the Schedule 1-A instructions. Only voluntary tips in an occupation on the IRS list count; mandatory service charges don't. You need a valid Social Security number. W-2 instructions (code TP) · Schedule 1-A lines 4–5 · IRS tipped occupations listFind it on your W-2, box 12, code TT.More detailsType the code TT number exactly as it appears. Your employer has already done the math: code TT is only the extra "half" of your overtime pay, not your whole overtime check. For 2026, only overtime your employer reports in box 12, code TT can be deducted. More than one W-2? Add their code TT amounts together. No code TT on your W-2? Ask your employer's payroll team before you file. IRS FS-2026-13, Q10, Q19, Q20RECHECK 2026
Optional: check your W-2 number(this does not change your deduction)Count only hours over 40 in a week.Use your normal hourly pay, not your overtime rate.More details (double time)
The rule is the same for time-and-a-half and double time: only half of your regular rate counts for each overtime hour.
• Time-and-a-half at $30/hour: you're paid $45, and $15 counts.
• Double time at $30/hour: you're paid $60, and still only $15 counts.
• Overtime paid only because of state law, a union contract or company policy (like daily overtime) doesn't count. Only overtime for hours over 40 in a week, required by federal law (FLSA), counts.
So the check is: hours × regular rate × 0.5. If it's far from your code TT number, ask payroll. FS-2026-13, Q1, Q12
Phase-out: each deduction drops $100 for every full $1,000 of MAGI over $150,000 ($300,000 joint). Partial thousands are dropped (1.5 → 1). Schedule 1-A lines 9–12, 17–20 · §224(b)(2)RECHECK 2026
Income tax only. These lower federal income tax; Social Security and Medicare tax still apply, and state tax may not follow. You can claim them whether or not you itemize. IRS
Self-employed tips can't exceed your net profit from that business. Schedule 1-A line 5
A deduction lowers taxable income, not your tax bill dollar for dollar. Your actual savings is roughly the deduction × your top tax bracket.
Solo Paycheck · Education, not tax advice · Rules checked Oct 26, 2026 against the 2025 Schedule 1-A and IRS FS-2026-13.