Does Utah follow the federal no-tax-on-tips and overtime deductions?
DOES NOT CONFORM (TY2025)
Utah does not follow the federal deductions for state income tax. You can still claim the tips and overtime deductions on your federal return (Schedule 1-A) — they simply do not reduce your Utah state tax. Do not assume your state return treats this income the way your federal return does.
Verified against the official state source below — last verified October 26, 2026
| Deduction | Utah position |
|---|---|
| Federal tips deduction (IRC §224) | Does not conform |
| Federal overtime deduction (IRC §225) | Does not conform |
What the state itself says
- Official source
- Utah State Tax Commission, "2025 TC-40 Instructions"
- Tax years covered
- 2025.
Utah starts from federal AGI, which §§224/225 do not reduce, and the TC-40A Part 2 subtraction list is a closed statutory list with no tips/overtime item; the only Schedule 1-A reference in the entire 2025 TC-40 booklet is the senior enhanced deduction in the Qualified Exempt Taxpayer Worksheet, and "overtime" appears nowhere. Utah has issued no tips/overtime-specific guidance. Basis: official form structure.
Your federal deduction is separate
Whatever your state does, the federal deductions run on their own rules: check your W-2 codes with the W-2 Code Checker, estimate with the Tips Calculator and Overtime Calculator, and see the glossary for any term. All state positions: the state-by-state index.
State position verified October 26, 2026 from the official source above. State guidance changes; confirm on the source before filing. This page is general information, not tax advice.