DE HB126

Exempts overtime pay from Delaware state income tax for full-time hourly wage-paid employees who work more than 40 hours per week, effective for tax years beginning January 1, 2026, through December 31, 2027

Requires employers to report to the Division of Revenue the total amount of overtime compensation paid to full-time hourly employees and the number of employees receiving such pay

Mandates baseline data collection for tax year 2025, with employer reports due by January 31, 2026, to establish pre-exemption overtime figures

Division of Revenue must share collected overtime data with the Controller General, Office of Management and Budget, Department of Finance, and Division of Legislative Services within 30 days of receipt

Authorizes the Division of Revenue to adopt regulations to administer and enforce the overtime tax exemption program