House Bill 375
By: Representatives Smith of the 18th, Tarvin of the 2nd, Powell of the 33rd, Momtahan of the
17th, Gunter of the 8th, and others
A BILL TO BE ENTITLED
AN ACT
To amend Article 2 of Chapter 7 of Title 48 of the Official Code of Georgia Annotated,
relating to the imposition, rate, computation, exemptions, and credits for state income tax,
so as to exclude overtime compensation from taxation; to provide for reporting by
employers; to provide for rules and regulations; to provide for a definition; to provide for
related matters; to provide for an effective date and applicability; to repeal conflicting laws;
and for other purposes.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:
SECTION 1.
Article 2 of Chapter 7 of Title 48 of the Official Code of Georgia Annotated, relating to the
imposition, rate, computation, exemptions, and credits for state income tax, is amended in
subsection (a) of Code Section 48-7-27, relating to the computation of taxable net income,
by deleting "and" at the end of paragraph (14), by replacing the period at the end of
paragraph (15) with "; and", and by adding a new paragraph to read as follows:
<ins>"(16)(A) For all taxable years beginning on or after January 1, 2026, any amount
received by a full-time employee paid by an hourly wage as compensation for work
</ins>
<ins>performed in excess of 40 hours a week, and any amount paid as overtime
compensation in accordance with the federal Fair Labor Standards Act of 1938.
(B) Notwithstanding subparagraph (A) of this paragraph, for employers governed by
the federal National Railway Labor Act, the exemption provided in this paragraph shall
apply to hourly component overtime compensation as defined in applicable collective
bargaining agreements.
(C) For each tax year beginning on or after January 1, 2026, each employer shall
submit to the department, on forms prescribed by the department, the total amount
received by full-time employees paid by an hourly wage as compensation for work
performed in excess of 40 hours a week and the total number of employees to which
such compensation was paid. The data shall be provided monthly or quarterly and shall
be due no later than the due date for the corresponding monthly or quarterly
withholding tax returns.
(D) The department may require additional information of employers and shall be
authorized to adopt rules and regulations to provide for the administration of this
paragraph."
</ins> SECTION 2.
This Act shall become effective on July 1, 2025, and shall be applicable to all taxable years
beginning on or after January 1, 2026.
SECTION 3.
All laws and parts of laws in conflict with this Act are repealed.