Understanding OBBBA (One Big Beautiful Bill Act)

⚡ What Is OBBBA?

The One Big Beautiful Bill Act (OBBBA) is a U.S. federal law that introduces a temporary federal income tax deduction for eligible employees who earn tips and overtime pay.

OBBBA was signed into law on July 4, 2025, and applies retroactively from January 1, 2025, through December 31, 2028.

Under this law:
    •    Employees may be eligible to deduct qualified tips and qualified overtime on their individual tax returns
    •    Employee pay does not change
    •    Employer payroll tax withholding does not change

📌 Key message for employers:
You should continue processing payroll exactly as you do today. Employees—not employers—claim the OBBBA deduction when they file their personal tax returns.

🔐 Access required

OBBBA-related payroll tracking and reporting are available to USA accounts with the Payroll Add-On.

Who can manage OBBBA-related setup and access tax documents?

• Super Administrators: Have full access to create, manage, and update employee position setup details, including assigning and maintaining TTOC Codes required for OBBBA tracking.
• Team Administrators: Can create, manage, and update employee position setup details only if they have the Setup Company Positions permission enabled. If you’re unable to access position setup, confirm your permissions with a Super Administrator.
• Employees: Can access and download their OBBBA-related tax documents from their account (under My Files) to support filing their individual tax returns.

📋 Topics covered in this article:

• Ensuring that OBBA is Tracked Correctly
• Accessing OBBBA Tax Documents
• Frequently Asked Questions About OBBBA

📚 Related articles:

• When Will W-2s Be Available In Push?
• How To View And Download T4s / W-2s As An Employee

Ensuring that OBBA is Tracked Correctly

To ensure the system can accurately track and report earnings under the One Big Beautiful Bill Act (OBBBA), each employee position in your account must be reviewed and assigned a TTOC Code, or explicitly marked as No TTOC Code Required.

TTOC Codes allow the system to determine whether a position may be associated with qualified tips and/or qualified overtime premiums for OBBBA reporting purposes. Without a TTOC Code selection, the system may be unable to properly identify eligible earnings for employees.

📌 Note: Assigning a TTOC Code does not change how employees are paid or how payroll taxes are withheld. This setup is used for tracking and reporting only, so employees can access the appropriate documentation when claiming eligible OBBBA deductions on their individual tax returns.

To create a new position:

1. Click the Employees tab.
2. On the left-hand Navigation bar, click Employee Positions.
3. Click Add a New Position.
4. Fill in the position details.

5. Under TTOC Code, click the drop-down menu and select the applicable code associated with the role.

   📌|  Note: If a position does not require a TTOC Code, select No TTOC Code Required from the drop-down menu.
   ⚠️ | Warning: If you do not assign a TTOC code to a Position, the system will provide a list and warning under the Run Payroll page of Positions with missing codes. 

6. Once done, click Add New Position.

To update an existing position:

1. Click the Employees tab.
2. On the left-hand Navigation bar, click Employee Positions.
3. Click Add a New Position.
4. Locate the relevant position and under Edit, click the Pencil icon.

5. Under TTOC Code, click the drop-down menu and select the applicable code associated with the role.

   📌|  Note: If a position does not require a TTOC Code, select No TTOC Code Required from the drop-down menu.
   ⚠️ | Warning: If you do not assign a TTOC code to a Position, the system will provide a list and warning under the Run Payroll page of Positions with missing codes. 

6. Update any other position details if applicable.
7. Once done, click Update Position.

After TTOC Codes are assigned to positions

Once you’ve reviewed and assigned a TTOC Code (or selected No TTOC Code Required) for each position, no further setup is required. Your account will be ready to support OBBBA tracking.

Any position that does not have a TTOC Code assigned will have a reminder appear on the Run Payroll page. This reminder lists the affected positions and includes direct links to each position’s setup page, making it easy to review and update the details as needed.

This reminder is designed to help ensure positions are configured correctly before payroll is processed. Payroll can still be run, but positions without a TTOC Code may limit the system’s ability to properly track and report OBBBA-eligible earnings for employees.

Accessing OBBBA Tax Documents

Once employee positions have been reviewed and updated, the system can support OBBBA-related reporting for eligible earnings.

For the 2025 tax year, OBBBA information will be provided to employees through a separate tax document that includes the relevant details for:
    •    Qualified tips
    •    Qualified overtime premiums

This document will be:
    •    Automatically generated
    •    Uploaded to the employee’s account
    •    Available under My Files for easy access during tax season from a desktop or mobile device

📌|  Note: This document is provided to support employees when claiming the OBBBA deduction on their individual tax returns. Payroll withholding and standard tax forms remain unchanged for 2025.

For future tax years, OBBBA-related information is expected to be incorporated directly into the employee’s W-2, in line with finalized IRS reporting requirements. Once this change takes effect, employees will no longer need a separate OBBBA document, as qualified tips and qualified overtime details will be included as part of their standard year-end tax reporting.

Employers do not need to take any additional action beyond ensuring employee positions are set up correctly. Employees will automatically receive the appropriate documentation through their account when it becomes available.

Frequently Asked Questions About OBBBA

Have questions about managing OBBBA? Whether you’re wondering how OBBBA affects payroll processing, where employees can find their tax documents, or how to handle common questions from your team, this section provides quick answers to help you navigate the process.

💡| Tip: Can’t find what you’re looking for? Contact our Support Team at support@pushoperations.com or utilize our AI bot Astra for quick assistance!

Q: What is a TTOC Code and why is it required?
A:  A TTOC Code is used to help identify employee positions for OBBBA tracking, including both qualified tips and qualified overtime. Assigning the correct TTOC Code allows the system to support documentation for qualified tips under OBBBA. If a position does not require a TTOC Code, it should be explicitly marked as No TTOC Code Required.

Q: What happens if a position does not have a TTOC Code assigned?
A: If employees receive earnings under a position that does not have a TTOC Code assigned, a notice will appear when you reach the Run Payroll step. This notice is informational and gives you an opportunity to review the affected positions before processing payroll. Payroll can still be completed, but positions without a TTOC Code may limit the system’s ability to support OBBBA-related tracking and reporting for employees.

Q: When should I select “No TTOC Code Required”?
A: You should select No TTOC Code Required for positions that do not customarily or regularly involve tip-earning activity and are not expected to require OBBBA tracking for qualified tips or qualified overtime. Selecting this option confirms that the position does not need to be included in OBBBA reporting and helps prevent unnecessary notices during payroll review.

Q: Do I need to change how payroll is processed because of OBBBA?
A: No. OBBBA does not change how payroll is calculated or how taxes are withheld. Employers should continue processing payroll and withholding federal income tax, Social Security, Medicare, and FUTA taxes exactly as they do today. The OBBBA deduction is claimed by employees on their individual tax returns.

Q: Do employees receive higher take-home pay through payroll?
A: No. OBBBA does not affect an employee’s pay or net earnings on a paycheck. Any tax benefit related to OBBBA is realized when the employee files their personal tax return, not during payroll processing.

Q: Do employers stop withholding federal income tax from tips or overtime?
A: No. Employers must continue withholding all required payroll taxes from both tips and overtime pay. OBBBA introduces a federal income tax deduction for employees, but it does not change employer withholding obligations.

Q: Why do employee positions matter for OBBBA tracking?
A: Employee positions help identify roles that may include qualified tips and support accurate tracking of eligible earnings under OBBBA. Keeping positions up to date ensures the system can provide the appropriate reporting information for employees when they prepare their tax returns.

Q: Do all tips and overtime qualify under OBBBA?
A: No. Only certain earnings qualify. For tips, the deduction applies to voluntary tips earned in occupations that customarily and regularly received tips prior to December 31, 2024. Mandatory service charges and automatic gratuities are not considered qualified tips. For overtime, only the federally required overtime premium for hours worked over 40 in a workweek qualifies. Straight-time earnings and overtime required solely by state laws or collective bargaining agreements are not eligible.

Q: Where will employees find their OBBBA tax information?
A: For the 2025 tax year, employees will receive a separate OBBBA-related tax document that is automatically uploaded to their account under My Files. For future tax years, OBBBA information is expected to be included directly on the employee’s W-2.

Q: Do employers need to provide tax advice to employees?
A: No. Employers are not responsible for determining employee eligibility or advising on how to claim the deduction. Employees should consult a tax professional if they have questions about how OBBBA applies to their personal tax situation.

Q: Are state or local taxes affected by OBBBA?
A: Although OBBBA only applies to federal taxes, individual states are reviewing their own tax rules in response and may decide to align state taxes with OBBBA rules. Review your individual state's websites and resources for more information.