Alabama · rules verified
Alabama Overtime Calculator
Alabama never wrote its own wage-and-hour law, so every overtime question here is answered by the federal Fair Labor Standards Act. What Alabama does have is a tax break: from 2026 you can knock up to $1,000 of overtime premium off your state taxable income.
Alabama workweek
Bonus, shift pay & state options
$1,207.80
50 h worked · 10 h at 1.5×
| Straight-time pay (all hours + bonus) | $1,098.00 |
|---|---|
| Overtime premium at 1.5× | $109.80 |
| Double-time premium at 2× | $0.00 |
| Total for the week | $1,207.80 |
Your no-tax-on-overtime deduction
Alabama (2026): its own overtime deduction of up to $1,000 — $1,000.00 for you.
No state statute, no state referee
There is no Alabama minimum wage and no Alabama overtime act. Time and a half after 40 hours in the workweek applies because the FLSA covers your employer or your job — and if it does not, Alabama law gives you nothing to fall back on.
That also decides where a complaint goes. Unpaid overtime in Alabama is a matter for the U.S. Department of Labor’s Wage and Hour Division, which takes the complaint and investigates the employer; no state agency collects back pay.
Three tax years, three different answers
Alabama has changed course twice. Act 2023-421, as amended by Act 2024-437, excluded overtime pay from income for hourly workers — but the Department of Revenue announced that the exclusion stopped for pay after June 30, 2025, and told employers to show the excluded wages in W-2 box 14 as “EX OT WAGES”.
For 2026 through 2028, Act 2026-604 (HB 527, signed April 16, 2026) replaces it with a narrower deduction: the lesser of your qualified overtime premium — defined by reference to the federal § 225 — or $1,000 per taxpayer, available whether or not you itemize. ALDOR’s own illustration uses a $10 worker paid $15 for overtime: only the $5 premium is deductible.
Reading the result for an Alabama return
Your federal deduction and your Alabama deduction start from the same W-2 box 12 code TT figure, but Alabama stops at $1,000 and has no income phase-out. A worker with $3,000 of premium can deduct all of it federally (below the caps) and $1,000 on the Alabama return.
Example week
Alabama’s median hourly wage across all occupations was $21.96 in May 2025; here is that worker on five 10-hour days.
| Day | Hours | Regular | 1.5× | 2× |
|---|---|---|---|---|
| Mon | 10 | 10 | 0 | 0 |
| Tue | 10 | 10 | 0 | 0 |
| Wed | 10 | 10 | 0 | 0 |
| Thu | 10 | 10 | 0 | 0 |
| Fri | 10 | 0 | 10 | 0 |
Minimum wage path
| Now | Next |
|---|---|
| 7.25 | — |