• General and Department Managers: Employees whose primary duty is managing the enterprise or a recognized department; who direct at least two full-time employees; and who have hiring/firing authority or significant input into those decisions. • Commissioned Employees: Employees whose earnings are more than 50% commissions and whose pay rate exceeds 1.5× the applicable minimum wage in weeks where overtime is worked. Non-Exempt Employees (Eligible for Qualified Overtime) • Quick lube technicians (unless considered commissioned employees — see previous) • Detailers • Drivers • Clerical office staff • Other employees not primarily engaged in sales, parts, and service work This article is not intended to serve as a definitive FLSA classification guide. Instead, dealers should review current pay plans and identify employees who may be eligible for the new deduction to ensure accurate reporting and communication. REPORTING REQUIREMENTS The IRS has granted employers temporary relief from mandatory W-2 reporting of qualified tips and overtime for the 2025 tax year. Dealers will not be required to report this information until 2026 W-2s (filed January 2027). Dealers may choose to voluntarily report qualified overtime on 2025 W-2s — either in Box 14 or through a separate statement. Employees who need the information for their 2025 tax filings may also rely on their final year-end pay stub. For 2026, employees should review and update the revised Form W-4. Those employees who expect qualified tips or overtime may adjust their withholding accordingly. Dealers must ensure their payroll systems can accommodate the new deduction line and should consult IRS Publication 15-T for updated federal withholding tables. BOTTOM LINE While these new provisions may not significantly impact dealership operations, dealers should be prepared to answer employee questions, understand which roles may qualify, and ensure payroll and reporting processes are aligned with OBBBA requirements. Taking proactive steps now will help minimize confusion and ensure compliance when the new rules take effect. Steve Williams, CPA/ABV, is a member of Tetrick & Bartlett PLLC and has been providing accounting, tax, valuation and consulting services to automobile dealers since 2007. Tetrick & Bartlett PLLC currently serves over 50 dealers in West Virginia, Virginia, Ohio, and Pennsylvania and is a member of the AutoCPA Group, a nationwide organization of CPA firms specializing in services to automobile dealers. Steve can be reached at swilliams@tb.cpa or (304) 366-2992. WVADA NEWS 17 THANK YOU, WVADA DEALERS! Your generous support helps us support our missions to get West Virginians back on the road to independence. Good News Mountaineer Garage puts people on the road with the help of many individuals and organizations. Our model consists of accepting repairable donated vehicles which are then distributed across West Virginia to qualified families in need of transportation to work or job training. We also have a program to help individuals through the process of applying for a loan, learning about credit and purchasing a vehicle. www.goodnewsmountaineergarage.org
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