Rep. Russ Fulcher, R-Idaho, reintroduced legislation on Wednesday that would eliminate taxes on overtime pay, an idea supported by President-elect Donald Trump during the 2024 campaign, The Hill reported.
Fulcher's Keep Every Extra Penny (KEEP) Act seeks to remove income tax on overtime, according to a press release.
"Americans who choose to work overtime to support their family should be able to keep more of their hard-earned paycheck, not less," Fulcher said in a statement.
"After years of suffocating inflation, many are looking for financial relief. This legislation will help address our nation's significant workforce shortage and put more money back in people's pockets."
Fulcher first introduced the legislation to eliminate taxes on overtime pay last summer, pitching it as a mechanism to address the ongoing labor shortage.
The KEEP Act aims to eliminate income taxes rather than payroll taxes to ensure that Social Security, Medicare, and unemployment funding remain unaffected. The bill targets Americans currently eligible for overtime, as defined in the Fair Labor Standards Act under Section 7.
With Republicans now in control of the House, Senate and the White House, Fulcher's bill stands a better chance of becoming law.
In September, Trump told a crowd in Arizona, "We will end all taxes on overtime. You know what that means?
"Think of that. That gives people more of an incentive to work, it gives the companies a lot, it's a lot easier to get the people."
"The people who work overtime are among the hardest working citizens in our country, and for too long no one in Washington has been looking out for them," he said.