W-2 code TT: Salaried non-exempt employees
Short answer: When a salary pays for a fixed number of hours, the regular rate is the weekly salary divided by those hours, and code TT is half that rate for each hour over 40.
Example
$800 a week for 40 hours gives a regular rate of $20. In a 44-hour week the four overtime hours are owed at $30, and code TT is the half: 0.5 × $20 × 4 = $40. A monthly salary is converted first: monthly × 12 ÷ 52.
$800 a week for 40 hours gives a regular rate of $20. In a 44-hour week the four overtime hours are owed at $30, and code TT is the half: 0.5 × $20 × 4 = $40. A monthly salary is converted first: monthly × 12 ÷ 52.
The rules
- Regular rate = weekly salary ÷ the hours it is meant to cover (29 CFR 778.113).
- Semimonthly salary: × 24 ÷ 52. Biweekly: ÷ 2.
- Exempt salaried staff have no qualified overtime at all (FS-2026-13 Q4).
Work it out for your payroll
The free code TT calculator does this per workweek for one employee or a whole payroll CSV, with bonuses spread back and weeks split by pay date. It runs in your browser.
The free code TT calculator does this per workweek for one employee or a whole payroll CSV, with bonuses spread back and weeks split by pay date. It runs in your browser.
Whole payroll, offline? The W-2 Code TT Kit runs every employee in one file with no network access, plus CSV templates, the week-by-week audit trail and a 12-page guide to every rule.
Get the kit ($29, accountants $99)
Get the kit ($29, accountants $99)
Sources
Not tax or legal advice. Facts checked 27 Oct 2026 against the IRS FAQs (FS-2026-13) and the FLSA regulations.
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