Summary

Allows employees to deduct certain work-related expenses they pay, including union dues and other employee business expenses, that were previously limited or disallowed. It treats union dues and related expenses as an above-the-line deduction and restores treatment of other employee trade-or-business expenses as miscellaneous itemized deductions. The changes apply for taxable years beginning after December 31, 2024.

Key Points

• Reinstates deductions for employee-paid work expenses that were previously limited or disallowed.
• Treats union dues and certain related expenses as an above-the-line deduction (reduces AGI).
• Restores treatment of other employee trade-or-business expenses as miscellaneous itemized deductions.
• Effective for tax years beginning after December 31, 2024.
• Benefits employees who pay unreimbursed job expenses and union members; value depends on whether taxpayer itemizes.
• Increases paperwork and recordkeeping needs for taxpayers and preparers to document qualifying expenses.
• Likely reduces federal income tax revenue relative to current law (no appropriation or offset provisions included).
• Does not itself specify detailed documentation rules or dollar limits; IRS guidance will be needed for implementation.

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