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Does Colorado Tax Tips and Overtime? (2026)

Tax year 2026 · Last updated · Maintained by the WattFlow team

Partly follows. Colorado starts from federal taxable income. The Department of Revenue says the federal tips deduction carries through, but the full federal overtime deduction must be added back on the Colorado return for 2026 and later.

Tips

Follows federal: no add-back for qualified tips

Overtime

Taxed: the federal overtime deduction must be added back (2026 and later)

Checked against the official source on 2026-11-11. State rules can change; confirm with the Colorado tax agency before you file.

Your federal deduction

The federal deductions apply in every state: up to $25,000 of tips and up to $12,500 of overtime ($25,000 joint). Use the calculator to see your federal savings.

Federal tips + overtime calculator

Private: runs in your browser
Form 1040, line 11. Include your overtime and tips.
Find the letters TT in box 12. Add up all your W-2s.
Must be on the IRS tipped jobs list.
Gig work or 1099 tips? DoorDash, Uber, self-employed
Schedule C net profit. You can’t deduct more than this.
More options Tax year, itemizing, special cases
Leave blank if you take the standard deduction.

Estimate of federal income tax only. Not tax advice.

Frequently asked questions

Does Colorado tax tips in 2026?

Follows federal: no add-back for qualified tips. The federal deduction still lowers your federal income tax.

Does Colorado tax overtime in 2026?

Taxed: the federal overtime deduction must be added back (2026 and later).

Does the federal deduction still apply?

Yes. Wherever you live, you can claim the federal tips and overtime deductions on Schedule 1-A if you qualify.