PayStub Parser Publishes a Free Projector for the 2026 Overtime and Tips Deductions

The One Big Beautiful Bill Act created four above-the-line deductions that are claimed on a new Form 1040 attachment, Schedule 1-A: qualified tips, qualified overtime, car loan interest and an enhanced deduction for seniors. Each carries its own cap and its own phaseout, and three of the four require a joint return from a married taxpayer.

The practical problem for a wage earner is timing. The figures that substantiate the tips and overtime deductions arrive in Box 12 of a Form W-2 that employers do not have to furnish until January 31, 2027, which is after the year in which the taxpayer could still have changed withholding, deferred a bonus, or made a deductible contribution to keep MAGI under a phaseout threshold. The year-to-date columns on a pay stub carry the same underlying numbers all year.

The projector at paystubparser.com takes year-to-date gross wages, overtime and reported tips plus a pay-period frequency, projects each figure to year end, and applies the statutory cap and stepped phaseout for the tips and overtime parts of Schedule 1-A. It asks explicitly whether the overtime figure entered is the FLSA premium or total pay at time-and-a-half, because entering the full overtime paycheck is the error that most often produces a wrong answer with correct arithmetic. It also applies the $25,000 tips cap per return rather than doubling it for joint filers.

The tool is free, requires no account, and is labelled an estimate rather than tax advice. It covers the two Schedule 1-A parts a pay stub can substantiate. The other two, car loan interest ($10,000 cap, reduced $200 per $1,000 of MAGI over $100,000 single / $200,000 joint) and the enhanced senior deduction ($6,000 per eligible person, reduced by 6% of excess MAGI over $75,000 / $150,000), are covered by a companion Schedule 1-A estimator at 1040parser.com.