Tax Fairness for Workers Act

Summary

Allows employees to deduct job-related expenses that were previously disallowed by the 2% miscellaneous itemized deduction floor and a related above-the-line limitation. Specifically restores deductibility for employee trade-or-business expenses (including union dues and expenses) by amending the Internal Revenue Code and makes the change effective for tax years beginning after December 31, 2024.

• Restores deductibility of certain employee job-related expenses that were previously disallowed by the 2% miscellaneous itemized deduction floor.
• Specifically treats union dues and expenses tied to performing services as an employee differently for above-the-line and itemized-deduction rules.
• Exempts employee trade-or-business miscellaneous itemized deductions from the 2% floor and narrows which miscellaneous items are counted for that floor.
• Effective for taxable years beginning after December 31, 2024 (generally tax year 2025 onward).
• Benefits employees with unreimbursed work expenses and union members who pay dues or related job costs.
• Does not change deductibility rules for self-employed taxpayers, who already deduct business expenses differently.
• May reduce federal tax revenue relative to current law and could influence state tax conformity and IRS administration.