The One Big Beautiful Bill – An Employer Impact Review
June 4, 2025
by Lofton Staffing
June 4, 2025
by Lofton Staffing
The “One Big Beautiful Bill” (OBBB), recently proposed in Congress, has stirred considerable attention across industries for its broad economic and workforce implications. A standout provision? The federal income tax deduction for qualifying overtime pay. While the bill is still working its way through the legislative process, employers should begin evaluating its potential impact now.
This review breaks down the most important considerations employers need to keep in mind—along with key questions to guide your internal planning and compliance efforts.
The overtime deduction provision provides a federal income tax deduction for certain employees on their qualified overtime pay. Here is what you need to know:
If passed, this federal provision tied to how overtime is compensated and taxed will create new considerations for employers and employees alike. While the bill awaits Senate approval, proactive employers will want to be ready.
Even though the deduction benefits employees, the compliance burden will fall largely on employers. You’ll need to ensure that your payroll systems and processes can:
Tax-deductible overtime may appeal to many employees, but it also introduces complexities. Employers should anticipate:
Your existing policies on overtime eligibility, limits, and approval procedures may need updates. Consider:
While the deduction does not reduce employer tax liability, the downstream effects could impact labor costs. Considerations should include:
Whether you think the OBBB is a Beauty or a Beast, it marks a major shift in how federal tax law intersects with wage and hour regulations. While much remains to be finalized, the direction is clear: employers must prepare for change. Start conversations with your payroll provider, HR team, legal counsel, and tax advisor. Proactive planning will be key.
Want a simple, actionable checklist to guide internal discussions? Reach out—we’ll send it your way.
Choosing Lofton Staffing as your staffing partner offers a strategic advantage in today’s competitive job market. With decades of industry expertise and a comprehensive understanding of both the staffing and security sectors, Lofton excels in connecting organizations with top-tier talent that not only meets the technical requirements of each role but also aligns with your company’s culture and values. Our tailored approach ensures that we effectively address your specific needs, while our commitment to excellence and integrity helps mitigate hiring risks, reduces turnover, and enhances overall employee satisfaction. By partnering with Lofton, business executives and HR managers can streamline their recruitment processes, save valuable time and resources, and ultimately cultivate a workforce ready to drive organizational success.
About Lofton: Founded in 1979, Lofton Services offers clients the best of all worlds. We provide the responsive, personal service and flexibility of a small local firm while having the technology, resources, and infrastructure to deliver the benefits of the biggest players in our industry. Lofton can deliver the right people, with the right skills, right when you need them. Contact us today.