How to calculate time and a half: formula, examples and holiday pay

To calculate time and a half, multiply your regular hourly rate by 1.5, then multiply by your overtime hours. At $20 an hour, time and a half is $30, so 6 extra hours add $180. That is how to calculate time and a half in most US jobs. Federal law applies it to hours over 40 in a workweek.

Key points

• Formula: regular rate × 1.5 × overtime hours, plus your normal pay for the first 40 hours.
• When it applies: under federal law, hours over 40 in one workweek. Weeks can't be averaged.
• Bonuses count: a promised bonus raises your regular rate, so the overtime rate rises too.
• Holidays: federal law doesn't require time and a half for holidays or weekends. Your employer's policy or your state may.
• Tax: for 2025 to 2028, only the extra half of overtime pay counts toward the federal overtime deduction.

What is the time and a half formula?

Time and a half means one and a half times your regular rate for each overtime hour. The formula is: overtime pay = regular rate × 1.5 × overtime hours. Add that to your straight pay for the first 40 hours and you have the week's gross pay, before tax.

Here's a full week at $20 an hour and 46 hours worked:

Step	Sum	Result
Straight pay for 40 hours	40 × $20	$800
Overtime rate	$20 × 1.5	$30 an hour
Overtime pay for 6 hours	6 × $30	$180
Gross pay for the week	$800 + $180	$980

A quick way to do the 1.5 in your head: take the rate, halve it, add the two. $24 becomes $24 + $12 = $36. $17.50 becomes $17.50 + $8.75 = $26.25. If you like these shortcuts, I wrote up more of them in mental math tricks.

How do I work out time and a half when I get a bonus?

If the bonus was promised, for a target or for attendance, it goes into your regular rate before overtime is worked out. Add the bonus to your straight pay, divide by all the hours you worked, and that's your regular rate. Then pay half of that rate again for each overtime hour.

The Department of Labor's own example, from Fact Sheet 56C, uses $10 an hour, a $50 promised bonus and 43 hours:

Step	Sum	Result
Straight time	$10 × 43 hours	$430.00
Add the bonus	$430 + $50	$480.00
Regular rate	$480 ÷ 43	$11.16
Half time premium	$11.16 × 0.5	$5.58
Overtime due	$5.58 × 3 hours	$16.74
Total for the week	$480 + $16.74	$496.74

Notice the overtime hours were already paid at straight time in the first line, so only the half is added at the end. That is the same sum as time and a half, just done in a different order.

A bonus the employer decides on alone, at the end of the period and without any earlier promise, can be left out. Bonuses for hitting a target, for attendance or for staying through a busy season usually don't fit that description, so they go in.

Do holidays and weekends get time and a half?

Not under federal law. The Department of Labor says the Fair Labor Standards Act doesn't require overtime pay for work on Saturdays, Sundays, holidays or regular days of rest, unless overtime hours are worked on those days. Holiday time and a half is a company policy or contract benefit, not a federal rule.

That matters this month. Veterans Day is 11 November and Thanksgiving is Thursday 26 November, and plenty of people will work one or both expecting time and a half. Check your handbook or contract. If it promises holiday premium pay, that's what you're owed. If it doesn't, the holiday only counts toward overtime when your week goes past 40 hours.

One more trap: the 40 hours are counted per workweek, a fixed run of seven days your employer sets. You can't average two weeks. Thirty hours one week and fifty the next still means 10 overtime hours in the second week.

Does my state change how time and a half works?

Some states add rules on top of the federal ones. California is the well known case: time and a half after 8 hours in a workday, as well as after 40 in a week, and double time after 12 hours in a day. A 12 hour shift in California includes 4 overtime hours even if the week stays under 40.

Some workers also get different rules. Hospitals can use an 8 and 80 system over 14 days, and fire and police work periods have their own limits. If your job is salaried and exempt, none of this applies to you at all. That's the line I'd check first if your pay stub never shows overtime.

What part of time and a half is tax free in 2025 to 2028?

Only the extra half. The IRS says qualified overtime compensation is the overtime required under section 7 of the Fair Labor Standards Act, and the deductible part is the half in "time and one half". Up to $12,500 a year can be deducted, or $25,000 on a joint return, and the amount shrinks once income goes above $150,000, or $300,000 joint.

Back to the $20 example. Your overtime rate is $30, but $20 of that is your normal rate. The deductible part is $10 an hour, so 6 overtime hours give $60 of qualified overtime, not $180.

The IRS also says overtime that only a state law or a union contract requires doesn't qualify. So California daily overtime in a week under 40 hours, or a contract's holiday premium, generally isn't part of the deduction. From 2026, employers have to report qualified overtime separately, which should make the year end figure easier to check.

My honest take: "no tax on overtime" is a misleading name. It's a deduction on part of your overtime, and it doesn't touch your paycheck until you file.

How can ExtraHalf help with overtime?

I built ExtraHalf for this sum, because it's easy to get right once and hard to track all year. It's an overtime calculator and tip tracker for US hourly workers on Android. You log shifts or pay stub totals, and it shows the hours left before overtime this week and estimates your qualified overtime and tips for the federal deduction.

It applies weekly overtime after 40 hours, the hospital 8 and 80 rule and fire and police work periods, and it flags state daily overtime and union contract overtime that may not qualify. At the end of the year it exports a PDF and a CSV you can hand to whoever does your taxes. There's no account, and the figures are estimates, not tax advice.

Get ExtraHalf on Google Play. It isn't on the App Store yet. There's more on the ExtraHalf page and in what ExtraHalf is.

Frequently asked questions

How much is time and a half for $15 an hour?

Time and a half for $15 an hour is $22.50 an hour. Multiply $15 by 1.5, or add half of $15, which is $7.50, to $15. Five overtime hours at that rate add $112.50 to the week's straight pay for the first 40 hours.

Is time and a half paid after 8 hours a day?

Not under federal law, which counts only hours over 40 in a workweek. A few states add daily overtime. California, for example, pays time and a half after 8 hours in a workday and double time after 12. Check your state's labor department for its rules.

Do I get time and a half on Thanksgiving?

Only if your employer's policy or contract promises it, or if Thanksgiving hours push your week past 40. The Department of Labor says federal law doesn't require overtime pay for holidays unless overtime hours are worked on them. Check your handbook before the shift.

Is all of my overtime pay tax free?

No. For tax years 2025 to 2028, the federal deduction covers only the extra half of time and a half that federal law requires, up to $12,500, or $25,000 on a joint return. Your regular rate for those hours, and overtime required only by state law or a contract, generally don't qualify.

Does a bonus change my time and a half rate?

Yes, if the bonus was promised. A nondiscretionary bonus goes into the regular rate: add it to straight pay, divide by total hours worked, then pay half that rate again for each overtime hour. The Department of Labor's Fact Sheet 56C shows a full worked example.

How I wrote this

On 5 November 2026 I read the Department of Labor's overtime page and Fact Sheets 56A and 56C, California's overtime FAQ from the Department of Industrial Relations, and the IRS questions and answers on the qualified overtime deduction. I used Google Keyword Planner and Google Trends for the United States, where rising searches asked whether Labor Day and Columbus Day pay time and a half, and read recent posts on X about holiday shifts. The $20 examples are my own sums, and the bonus example is the Department of Labor's. This is general information, not tax or legal advice.