Delaware would exclude full-time hourly workers' pay beyond 40 weekly hours from income tax

Full-time hourly workers would subtract pay for work beyond 40 hours a week when calculating Delaware income tax. This would cover full-time workers who are paid by the hour. The subtraction would apply to tax years beginning January 1, 2026, and ending before January 1, 2028.

Employers would send pay totals and the number of workers who received that pay to Delaware's Division of Revenue. This would cover employers paying residents or nonresidents wages taxed by Delaware and subject to federal withholding. They would report pay for work beyond 40 hours a week received by full-time hourly workers. The 2025 tax year report would be due by January 31, 2026. Reports for tax years beginning January 1, 2026, and ending before January 1, 2028, would be due with employers' withholding returns.