Sponsors (4)
The bill raises after-tax pay and clarifies tax treatment for Border Patrol agents by expanding qualified overtime compensation, at the cost of some federal tax revenue and potential inequities for other federal employees.
Border Patrol agents will receive higher after-tax pay because certain supplemental, premium, and overtime pays are treated as qualified overtime compensation, increasing their take-home pay.
Border Patrol agents and taxpayers get clearer, explicit tax treatment for specified DHS pays by including certain 5 U.S.C. §5550 supplemental and premium pays and overtime under §5542(g), reducing ambiguity about how those pays are taxed.
The federal government will collect less income tax revenue because these Border Patrol pays are excluded as qualified overtime, modestly increasing the deficit or reducing funds available for other services.
Other federal employees who perform similar work but do not meet the bill's Border Patrol–specific definitions may not receive the same tax benefit, creating inequity among federal law-enforcement staff and potential morale/fairness problems.
Based on analysis of 2 sections of legislative text.
Allows certain supplemental, premium, and statutory overtime pays for Border Patrol agents to be excluded as qualified overtime compensation for federal income-tax purposes.
Expands a tax exclusion so certain additional pay received by Border Patrol agents is treated as "qualified overtime compensation" and excluded from income tax. The change adds specified supplemental and premium pays (but not hazardous duty pay) to the tax-preferred treatment, and applies to taxable years beginning after December 31, 2025. The amendment modifies the Internal Revenue Code definition of qualified overtime compensation to explicitly include several types of Border Patrol pay (including certain supplemental pays, premium pay, and statutory overtime), clarifying income-tax treatment for affected agents.
Official title: To amend the Internal Revenue Code of 1986 to provide that overtime pay provided to certain border patrol agents is qualified overtime compensation.
Introduced May 20, 2026 by Jodey Cook Arrington · Last progress May 20, 2026