Overtime Ready in 30: Is Your District Prepared for 2026?

You’ve probably heard the phrase “No tax on overtime.” 

But for school districts, the real question is: can you clearly separate the overtime premium the law refers to – and prove how you calculated it?

The 2025 federal tax law allows a deduction for the premium portion of overtime earned under the Fair Labor Standards Act (FLSA). That does not mean all overtime pay is treated the same. It applies only to a specific piece of overtime – and districts need to be able to identify that portion accurately. 

For many districts, that’s harder than it sounds.

If different sites track time differently, if payroll makes manual adjustments, or if separating overtime requires spreadsheet work after the fact, this new tax treatment can quickly create confusion and extra work.

In this 30-minute session, Frontline Education and Touchpoint K12 will walk through:

• What the overtime tax deduction actually applies to
• Why the “premium portion” is different from total overtime pay
• Where districts commonly run into trouble
• What clean, consistent processes look like across time tracking and payroll

We’ll use a simple four-part framework – ownership, time collection, payroll setup, and reporting – to help you think through whether your current approach makes this easy…or complicated.

If your team can’t quickly answer, “How do we isolate the FLSA premium for any employee, in any pay period?” this conversation will help you understand what needs to change.

The goal is straightforward: reduce confusion, avoid rework, and make sure your district can handle overtime reporting with confidence.