Tax Fairness Act Allows Full Deduction of Union Dues Starting 2025, Restores Itemized Job Expenses

If you’re an employee who pays union dues or has to shell out cash for work expenses, the Tax Fairness for Workers Act has some good news for your 2025 tax filing. This bill is essentially rolling back some prior tax changes that made it harder for regular employees to deduct costs related to their jobs.

The core of the bill, effective for tax years after December 31, 2024, is twofold: first, it makes union dues fully deductible “above the line,” and second, it restores the ability to itemize and deduct certain other employee business expenses.

The Union Dues Game Changer: Above the Line

For anyone in a union, this is a clean win. Currently, if you pay union dues, deducting them is often complicated or impossible if you don’t itemize. This bill changes that by allowing employees to deduct union dues and related expenses directly from their gross income to arrive at their Adjusted Gross Income (AGI). This is the coveted “above-the-line” deduction (Section 2).

Why does ‘above the line’ matter? It means you don’t have to worry about itemizing deductions, and the deduction isn’t subject to income limits or phase-outs. Let’s say you’re a tradesperson paying $800 a year in union dues. That $800 now comes off your income before calculating your AGI, which can also help you qualify for other income-based tax credits or deductions. It’s a straightforward reduction in your taxable income, rewarding those who are part of organized labor.

Bringing Back Job-Related Expenses for Itemizers

For a few years now, many employees who had to pay for things like required uniforms, professional licenses, or certain travel costs couldn’t deduct those expenses even if they itemized. That’s because the Tax Cuts and Jobs Act (TCJA) eliminated miscellaneous itemized deductions subject to the 2% floor.

This new bill reverses that for employees who choose to itemize. It restores the ability to deduct expenses “directly related to carrying on your trade or business as an employee” (Section 2). This means if you’re a nurse paying for continuing education required by your job, or a salesperson paying for tools or supplies your employer doesn't reimburse, you can potentially deduct those costs again, provided you itemize.

It’s important to note that these deductions are still subject to the 2% AGI floor—meaning you can only deduct the amount of these miscellaneous expenses that exceeds 2% of your AGI. But the key is that the option is back on the table for itemizers, offering relief to employees who shoulder significant unreimbursed job costs.

The Real-World Impact and What’s Next

This bill directly benefits working employees by lowering their tax burden. For union members, the benefit is clear and automatic. For those with high unreimbursed job costs, it offers a pathway to recoup some of those necessary expenses.

However, the bill is slightly vague on the exact definition of “certain other expenses related to your job as an employee” (Section 2). While the intent is clear—to cover necessary work expenses—the IRS will need to provide clear guidance to prevent confusion or disputes. While this bill is great for individual workers, it will reduce federal tax revenue, meaning less money flowing into the U.S. Treasury.