Calculate the gross premium
At $20 an hour, 40 regular hours produce $800. Five overtime hours at $30 produce another $150, for $950 gross that week. Employers must use the applicable regular rate, which can include more than a base hourly wage.
Understand the tax effect
Overtime is generally part of wages subject to payroll withholding. More gross pay can move the last dollars into a higher marginal bracket, but it does not reduce the after-tax value of the earlier hours.
Handle variable schedules
Our hourly converter assumes a stable weekly schedule and does not automatically add overtime. Calculate extra hours separately, then use the calculator with the combined annual gross amount for a planning estimate.
Use the numbers: Open the paycheck calculator to apply these ideas to a salary or hourly rate. The result is an annualized estimate; your employer’s actual withholding can differ.