SB 351

                SPONSOR:
                Sen. Richardson & Rep. Shupe
        DELAWARE STATE SENATE
        153rd GENERAL ASSEMBLY
        SENATE BILL NO. 351
        AN ACT TO AMEND TITLE 30 OF THE DELAWARE CODE RELATING TO PERSONAL INCOME TAX SUBTRACTIONS
        BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE:
        Section 1. Amend § 1106, Title 30 of the Delaware Code by making deletions as shown by strike through and insertions as shown by underline as follows:
        § 1106. Modifications [For application of this section, see 83 Del. Laws, c. 338, § 2].
        (b)
        Subtractions. —
         There shall be subtracted from federal adjusted gross income:
        (13) For taxable years beginning after December 31, 2026, the amount allowable as a deduction under § 225 of the
        Internal Revenue Code of 1986 [26 U.S.C. § 225], as in effect on December 31, 2025, for qualified overtime compensation received during the taxable year by a resident of this State. This subtraction remains in effect notwithstanding the expiration or repeal of the federal deduction.
        SYNOPSIS
        This Act creates a Delaware personal income tax subtraction for qualified overtime compensation that mirrors the federal deduction.  Eligible workers can deduct up to $12,500 of qualified overtime pay ($25,000 for married couples filing jointly) from their federal taxable income. The deduction begins to phase out when federal modified adjusted gross income (MAGI) exceeds $150,000 for single filers ($300,000 for joint filers). Only the overtime premium portion (the extra pay above the regular hourly rate) qualifies for the deduction.
        Author: Senator Richardson