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Senate State, Veterans, & Military Affairs

Thursday, February 26, 2026·29m·▶ Watch / Listen

The Senate State, Veterans, & Military Affairs Committee advanced SB26-056, which would modify state income tax treatment of overtime compensation, to the Appropriations Committee with a favorable recommendation over the objections of two members who argued the bill is poorly targeted and threatens funding for child poverty programs.

Key Actions

·SB26-056 – State Overtime Compensation Income TaxPassed

Controversies

Impact of SB26-056 on the Family Affordability Tax Credit (FATC)

Chris Stifler and Joshua Mantel argued the bill would reduce state revenue and could trigger reductions in or elimination of the Family Affordability Tax Credit and Earned Income Tax Credit. Senator Kirkmeyer rebutted: 'They were already going to be shut off in tax year 26. That already occurred. This bill is not impacting that. They were already going to be partially shut off in tax year 27. This bill doesn't make a change to that. They're still going to be partially shut off.'

+ 3 more controversies

Notable Quotes

“Working people deserve a tax break, especially when they're working overtime and we're taking them away from their families to keep the state running.”

Senator Kirkmeyer — Senator Kirkmeyer, co-prime sponsor of SB26-056, made this statement in closing argument in favor of the bill, which would eliminate state income taxation of overtime compensation.

+ 4 more quotes

Votes

Senator Pelton moved SB26-056 to Appropriations Committee with favorable recommendationPassed
Yes (3)William Lindstedt, Rod Pelton, Lynda Zamora Wilson
No (2)Tom Sullivan, Katie Wallace
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TranscriptPreview
Chair, I appreciate that and I appreciate the opportunity to be here today to present Senate Bill 26056. People like first responders, police, fire, EMS, essential workers such as nurses, childcare providers, home health aides, cashiers and retail clerks. There are some professions in the manufacturing that are production workers, machinists, purchasing agents, team assemblers, and a variety of jobs related to inspecting, testing and sorting. Manufacturing engineers, industrial engineers, welders, assembly operators, machine operators and inventory managers. These are examples of professions and people who receive and go after overtime. Members Every day there are two parent families or even single families where they leave and they go to work and they leave their families and they go work and then they go and they spend as much time as they can on overtime. Because of the situation we're in in this state where we are unaffordable, we're one of the most unaffordable states for housing in the nation. I think we're like fourth or fifth when it comes to childcare and the cost of childcare and the unaffordability. We have parents that spend a lot of time away from their family that go and get overtime so that…
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