# no-tax-on-overtime-mcp

An MCP server that calculates the 2025-2028 federal no tax on overtime, no tax on tips and senior deductions from the One Big Beautiful Bill Act (P.L. 119-21), using the IRS caps, phase-outs and bracket tables.

Hosted endpoint, no sign-in and no token:

```
https://no-tax-on-overtime-mcp.lipmichal.workers.dev/mcp
```

## Tools

| Tool | What it does |
|---|---|
| `calculate_overtime_deduction` | Deduction for qualified overtime after the $12,500 cap ($25,000 joint) and the MAGI phase-out. Takes the W-2 box 12 code TT amount, or hourly rate + overtime hours + multiplier, or total overtime pay, and keeps only the FLSA half-time premium. |
| `calculate_tips_deduction` | Deduction for qualified tips after the $25,000 per-return cap and the MAGI phase-out. Limits self-employed tips to net income. |
| `calculate_senior_deduction` | Enhanced $6,000 deduction per person age 65 or older, reduced by 6% of MAGI over $75,000 ($150,000 joint). Accepts birth dates. |
| `estimate_tax_savings` | Combines the three deductions and runs taxable income through the IRS bracket tables for the year to estimate federal income tax saved. |
| `explain_eligibility` | Who qualifies, the excluded filing status, the SSN rule, FLSA exemptions, the W-2 and 1099 boxes, Schedule 1-A lines, and the years covered. |

Every result has structured JSON, a plain-English summary, `as_of`, `source` (the irs.gov document) and `more` (a calculator page on noovertimetax.com).

## What it knows that your model does not

- These deductions started in tax year 2025, after most models were trained. The law was signed on July 4, 2025.
- The phase-out is $100 for each full $1,000 of MAGI over the threshold, rounded down, as Schedule 1-A lines 16-21 do it. It is not a smooth percentage.
- Only the FLSA premium qualifies. Ten double-time hours at $20 give $100 of qualified overtime, not $200 (IRS FS-2026-13 A16).
- From 2026 you may not use more than the amount in Form W-2 box 12 code TT. If your employer leaves it out, you need a Form W-2c (FS-2026-13, August 2026).
- The tips cap is $25,000 per return even on a joint return. The overtime cap doubles for joint returns. The senior reduction applies to each spouse separately.
- Married filing separately gets nothing from any of the three.
- 2025 and 2026 brackets from Rev. Proc. 2024-40 and Rev. Proc. 2025-32, including the OBBBA standard deduction amounts.

## Install

### Claude.ai custom connector or ChatGPT developer mode

Add a custom connector and paste the URL. No token is needed.

```
https://no-tax-on-overtime-mcp.lipmichal.workers.dev/mcp
```

### Claude Code

```
claude mcp add --transport http no-tax-on-overtime https://no-tax-on-overtime-mcp.lipmichal.workers.dev/mcp
```

Or run it locally:

```
claude mcp add no-tax-on-overtime -- npx -y no-tax-on-overtime-mcp
```

### Claude Desktop

Add this to `claude_desktop_config.json`:

```json
{
  "mcpServers": {
    "no-tax-on-overtime": {
      "command": "npx",
      "args": ["-y", "no-tax-on-overtime-mcp"]
    }
  }
}
```

### Cursor

Add this to `~/.cursor/mcp.json`:

```json
{
  "mcpServers": {
    "no-tax-on-overtime": {
      "url": "https://no-tax-on-overtime-mcp.lipmichal.workers.dev/mcp"
    }
  }
}
```

### VS Code

Add this to `.vscode/mcp.json`:

```json
{
  "servers": {
    "no-tax-on-overtime": {
      "type": "http",
      "url": "https://no-tax-on-overtime-mcp.lipmichal.workers.dev/mcp"
    }
  }
}
```

Node 20 or newer is needed for the local `npx` version.

## Example prompts

- "I make $28 an hour and worked 300 overtime hours at time-and-a-half in 2026. I file single and my MAGI is $72,000. How much can I deduct?"
- "My employer pays double time. Does all of it count for the no tax on overtime deduction?"
- "We file jointly, both of us are 67, and our MAGI is $180,000. What is our senior deduction for 2025?"
- "I'm a bartender with $31,000 in tips and $95,000 MAGI. What does the tips deduction save me in federal tax?"
- "My W-2 for 2026 has no box 12 code TT. Can I still claim the overtime deduction?"

## Data sources

All numbers come from irs.gov documents fetched on 2026-10-30: Schedule 1-A (2025 and the 2026 draft), the 2025 Form 1040 instructions, fact sheets FS-2025-03 and FS-2026-13, Rev. Proc. 2024-40 and Rev. Proc. 2025-32. See [DATA_SOURCES.md](DATA_SOURCES.md) for each item and URL.

## Limitations

- Results are estimates, not tax advice.
- Federal income tax only. Social security, Medicare and state taxes are not included.
- The IRS has not yet published 2027 or 2028 brackets. For those years the savings estimate uses the 2026 tables and says so.
- If you leave out taxable income, the savings tool uses MAGI minus the basic standard deduction. It ignores the extra standard deduction for age 65+, itemized deductions and credits.
- It does not decide whether you are FLSA overtime-eligible or whether your occupation is on the tipped list. `explain_eligibility` lists the rules.
- The car loan interest deduction is not covered.

## More

Calculators and guides for people: [noovertimetax.com](https://noovertimetax.com/?utm_source=mcp&utm_medium=no-tax-on-overtime-mcp).

Part of the Zovo MCP collection: https://mcp.zovo.one

## Development

```
npm install
npm run build
npm test
```

`src/core.ts` holds all the rules and has no I/O. `src/stdio.ts` is the local entry and `src/worker.ts` is the Cloudflare Worker entry. Both use the same tool registry in `src/tools.ts`.

## License

MIT

<!-- data-servers:start -->
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