--- title: HB 826. Overtime Income Tax Exemption Act; enact collection: bills id: 2025-2026/hb826 cite_as: HB 826, 2025-2026 Regular Session (Ga.) canonical_url: https://georgiacommons.org/bills/2025-2026/hb826 md_url: https://georgiacommons.org/bills/2025-2026/hb826.md text_url: https://georgiacommons.org/bills/2025-2026/hb826/text source_url: https://www.legis.ga.gov/legislation/71616 date: 2025-03-28 status: introduced corpus_version: bills-2026-08-28 license: Public record of the Georgia General Assembly, via LegiScan; see about.md publisher: Georgia Commons, an independent project of Georgia Civic Data. Not the State of Georgia. Not legal advice. up: https://georgiacommons.org/bills/2025-2026.md previous: https://georgiacommons.org/bills/2025-2026/hb825.md next: https://georgiacommons.org/bills/2025-2026/hb827.md index: https://georgiacommons.org/bills/index.md omitted: votes and history omitted_chars: 129 omitted_url: https://georgiacommons.org/bills/2025-2026/hb826.md?full=1 bill_number: HB 826 session: 2025-2026 Regular Session session_slug: 2025-2026 chamber: House bill_type: bill status_date: 2025-03-25 last_action: House Second Readers sponsors: - Tanya Miller - Samuel Park - Tyler Smith - Spencer Frye - William Werkheiser text_version: Introduced has_text: true legiscan_url: https://legiscan.com/GA/bill/HB826/2025 upstream_id: 2014704 summaries_model: claude-sonnet-5 topic_tags: - income tax - overtime pay - tax exemptions - hourly workers - state revenue --- # HB 826. Overtime Income Tax Exemption Act; enact ## Text 25 LC 59 0136 House Bill 826 By: Representatives Miller of the 62nd, Park of the 107th, Smith of the 18th, Frye of the 122nd, and Werkheiser of the 157th A BILL TO BE ENTITLED AN ACT To amend Article 2 of Chapter 7 of Title 48 of the Official Cod e of Georgia Annotated,1 relating to the imposition, rate, computation, exemptions, and credits for state income tax,2 so as to exclude up to $10,000.00 of overtime wages per employee from taxation; to provide3 for reporting by employers; to provide reporting by the department to the General Assembly;4 to provide for a sunset date; to provide for related matters; t o provide for a short title; to5 provide for legislative purpose; to provide for an effective date and applicability; to repeal6 conflicting laws; and for other purposes.7 BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:8 SECTION 1.9 This Act shall be known and may be cited as the "Overtime Income Tax Exemption Act."10 SECTION 2.11 The purpose of this Act is to reduce the tax burden on workers who earn overtime pay,12 incentivize productivity, and promote economic fairness for hourly employees.13 H. B. 826 - 1 - 25 LC 59 0136 SECTION 3.14 Article 2 of Chapter 7 of Title 48 of the Official Code of Georgia Annotated, relating to the15 imposition, rate, computation, exemptions, and credits for state income tax, is amended in16 subsection (a) of Code Section 48-7-27, relating to the computation of taxable net income,17 by deleting "and" at the end of paragraph (14), by replacing th e period at the end of18 paragraph (15) with "; and", and by adding a new paragraph to read as follows:19 "(16)(A) Up to $10,000.00 of income received by a full-time hourly waged employee20 as compensation for work performed in excess of 40 hours in a w eek, provided that21 such income is included in the taxpayer's federal adjusted gross income and, but for this22 paragraph, would be subject to taxation by this state.23 (B) For the tax year beginning on January 1, 2026, and each tax year thereafter, each24 employer shall submit to the department, on forms prescribed by the department, the25 total amount received by full-time hourly waged employees as compensation for work26 performed in excess of 40 hours in a week, the total number of employees for which27 such compensation was paid, and additional information as may b e required by the28 commissioner to effectuate this paragraph. Such data shall be provided monthly or29 quarterly and shall be due no later than the due date for the corresponding monthly or30 quarterly withholding tax returns.31 (C) No later than January 31, 2028, the department shall submit a report to the General32 Assembly documenting the fiscal impact of the income tax exempt ion provided in33 subparagraph (A) of this paragraph. The General Assembly may a djust tax rates or34 identify alternative revenue sources to address revenue shortfalls resulting from such35 exemption and modify or extend such exemption at any time before the repeal of this36 paragraph.37 (D) This paragraph shall stand repealed and reserved on December 31, 2030."38 H. B. 826 - 2 - 25 LC 59 0136 SECTION 4.39 This Act shall become effective on July 1, 2025, and shall be applicable to all taxable years40 beginning on or after January 1, 2026.41 SECTION 5.42 All laws and parts of laws in conflict with this Act are repealed.43 H. B. 826 - 3 - ## Summaries written by Georgia Commons The following was written by claude-sonnet-5 from the text above and is not part of the bill. Quote the text, not the summary. House Bill 826 would let Georgia workers exclude up to $10,000 of overtime pay per year from state income tax, starting with the 2026 tax year, and would require employers to report overtime pay data to the state. ### Plain-language summary Currently, overtime pay earned by hourly workers in Georgia is taxed the same as regular wages under state income tax law. House Bill 826, called the Overtime Income Tax Exemption Act, would change that by letting full-time hourly employees exclude up to $10,000 of overtime pay (earned for hours worked beyond 40 in a week) from their Georgia taxable income, as long as that pay is part of their federal adjusted gross income. Starting with the tax year beginning January 1, 2026, employers would have to report to the Georgia Department of Revenue how much overtime pay they paid, how many employees received it, and other details the commissioner requires, on the same schedule as their withholding tax returns. By January 31, 2028, the department must report the exemption's fiscal impact to the General Assembly. The exemption itself is set to expire automatically on December 31, 2030, unless lawmakers act to extend it. The overall law would take effect July 1, 2025. ### What it does - Creates a new state income tax exclusion of up to $10,000.00 per year for overtime pay earned by full-time hourly employees for hours worked beyond 40 in a week. - Requires employers to report the total overtime pay and number of employees receiving it to the Department of Revenue monthly or quarterly, starting with the 2026 tax year. - Directs the Department of Revenue to submit a report to the General Assembly by January 31, 2028 on the exemption's fiscal impact. - Automatically repeals the exemption on December 31, 2030 unless the General Assembly extends or modifies it beforehand. - Sets the law's effective date as July 1, 2025, applying to tax years beginning on or after January 1, 2026. ### Who it affects Full-time hourly employees in Georgia who work overtime, and the employers who must track and report overtime pay data to the Department of Revenue. The Department of Revenue and the General Assembly are also affected through new reporting duties. ### Why it matters Hourly workers who regularly work overtime could see a lower state tax bill, keeping more of their overtime earnings, while employers take on new reporting duties. Because the exemption expires at the end of 2030, its long-term availability depends on future legislative action. ### Key provisions - Section 1 titles the bill the 'Overtime Income Tax Exemption Act.' - Section 2 states the purpose is to reduce the tax burden on overtime earners, encourage productivity, and promote fairness for hourly employees. - Section 3 amends Georgia's income tax code (O.C.G.A. ยง 48-7-27) to add a new exemption of up to $10,000.00 for overtime pay, conditioned on it being part of federal adjusted gross income. - Section 3 also requires employers to report overtime pay totals and employee counts to the Department of Revenue on a monthly or quarterly basis starting in 2026. - Section 3 requires a Department of Revenue report to the General Assembly by January 31, 2028 on the exemption's fiscal impact, and lets lawmakers adjust tax rates or extend the exemption. - Section 3 sets the exemption to expire ('stand repealed and reserved') on December 31, 2030. - Section 4 sets the effective date as July 1, 2025, applicable to tax years beginning on or after January 1, 2026. ## Status - Status: Introduced (2025-03-25) - Last action: House Second Readers (2025-03-28) - Sponsors: Tanya Miller, Samuel Park, Tyler Smith, Spencer Frye, William Werkheiser - Official page: https://www.legis.ga.gov/legislation/71616 > The history, votes, and amendments (129 characters) are at https://georgiacommons.org/bills/2025-2026/hb826.md?full=1