This legislative proposal seeks to amend the Internal Revenue Code of 1986 by introducing a new deduction for specific types of overtime compensation. The primary goal is to reduce the tax burden on workers earning additional income through extended hours. The bill defines "qualified overtime compensation" in two main categories. First, it includes any overtime compensation required under Section 7 of the Fair Labor Standards Act of 1938 , which is paid in excess of an individual's regular rate. Second, it covers compensation paid at a rate of not less than one and one-half times the regular rate for work exceeding a standard number of hours for a single employer, provided this is stipulated in a collective bargaining or employer-employee agreement specifying at least 40 hours for a 7-day work period. These provisions aim to provide tax relief for both statutory and certain agreed-upon overtime earnings. The amendments made by this section are slated to take effect for all taxable years beginning after December 31, 2024 .