Box 12 Code TT Audit — 2026 W-2 Overtime by ReadyStack

Only the FLSA half-premium belongs in Code TT. Payroll exports put the whole time-and-a-half there.


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• FLSA half-premium only — Splits the one-half premium required by 29 USC 207 from the straight-time hours, because only that half is qualified overtime compensation under IRC 225.
• State-only daily overtime excluded — Daily overtime hours that a state (California 8+/day, Alaska, Nevada, Colorado) requires but the FLSA does not are not qualified overtime — they are removed from the Code TT figure.
• Payroll export drift — Shows what a payroll export writes into Box 12 when it maps the whole overtime gross, and the dollar overstatement per employee and across the company.
• 2026 deduction and phaseout — Applies the $12,500 / $25,000 cap and the $100-per-$1,000 MAGI phaseout above $150,000 / $300,000 so you can see what the employee may actually deduct.
• 6721 + 6722 exposure — Multiplies the affected headcount by both the information-return penalty and the payee-statement penalty, which apply separately to the same wrong form.
• Furnish deadline — Anchors the numbers to 2027-02-01, the date 2026 Forms W-2 must be furnished and filed, since January 31, 2027 falls on a Sunday.

| You type | |
|---|---|
| Non-exempt employees paid overtime | default 24 |
| Regular rate of pay | default 22 |
| Hours over 40 in the workweek (FLSA overtime) | default 6 |
| State-only daily overtime hours (not over 40) | default 3 |
| Weeks paid in 2026 | default 50 |
| What your payroll export maps to Box 12 | default Full overtime gross (typical export) |
| Employee expected 2026 MAGI | default 96000 |
| Employee filing status | default single |
| IRC 6721 tier per form ($) | default 340 |

| It answers | |
|---|---|
| Correct Box 12 Code TT per employee | $ |
| What your export writes into Box 12 | $ |
| Overstatement per W-2 | $ |
| Overstatement across the payroll | $ |
| State-only premium correctly excluded | $ |
| Deduction the employee may actually take | $ |
| Deduction overclaimed from the wrong W-2 | $ |
| IRC 6721 + 6722 exposure | $ |

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