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Bill

HB 39

Allow state income tax deduction for overtime wages

136th Legislature (2025-2026) Introduced by Sean Brennan and 14 co-sponsors

Ohio bill would allow state income tax deduction for overtime wages, reducing taxes for eligible workers but decreasing state revenue.

Referred to committee
#taxation
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Bill Summary · HB 39

Legislative bill overview

HB 39 would allow Ohio residents to deduct overtime wages from their state income tax calculations. The bill was introduced in early February 2025 and is currently in committee review. This would reduce taxable income for workers who earn overtime compensation.

Why is this important

Overtime workers would see reduced state tax liability, effectively increasing their take-home pay from overtime hours. This could particularly benefit lower and middle-income workers in manufacturing, healthcare, and service industries where overtime is common. However, it would also reduce state revenue unless offset by other measures.

Potential points of contention

  • Revenue impact: The state would collect less income tax unless spending is cut or other revenues increase, raising questions about budget sustainability
  • Equity concerns: The deduction benefits only overtime-eligible workers, potentially creating disparities with salaried employees or those unable to work overtime
  • Tax complexity: Adding a specific wage deduction increases tax code complexity and compliance burdens for filers and the state revenue department
  • Economic targeting: Critics may argue this is a narrow tax cut that doesn't address broader workforce compensation issues or cost-of-living pressures

Compiled from official sources — confirm details with the bill’s official record.

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