HR Policy Association

New Bill Would Change the Tax Treatment of Lawful Union Avoidance Costs

Senator Bob Casey (D-PA) recently introduced two bills to make the tax code “fairer” for workers and to end the deduction for lawful employee engagement costs during union organizing campaigns.

The No Tax Breaks for Union Busting Act would classify lawful union avoidance costs and National Labor Relations Act violations as not tax deductible, similar to how corporate political speech or lobbying is currently treated in the tax code. The bill would also create an IRS reporting requirement for employers regarding the consultants they retain. 

The Tax Fairness for Workers Act would allow workers to deduct from their income tax union dues and unreimbursed employment expenses such as travel and uniform costs. This would restore the deduction that was eliminated by the 2017 tax law.

According to Senator Casey, the two bills “would allow workers to once again deduct union dues and other work-related expenses, as well as clamp down on corporations looking to write off expenses they incurred attempting to keep their workers from organizing.”

Meanwhile, the Michigan Senate and House approved a bill repealing the state’s right-to-work law. If signed by Gov. Whitmer, which is expected, the number of states with right-to-work laws would drop to 26 and end Michigan's relatively short membership on that list.

Outlook: The Casey bill is a largely symbolic messaging bill since it’s unlikely to pass the GOP-controlled House or have 60 votes in the Senate to overcome a filibuster.

Published on: March 17, 2023

Authors: D. Mark Wilson

Topics: Employment Law

D. Mark Wilson

President and CEO, American Health Policy Institute

Detailed Bio

Contact D. Mark Wilson LinkedIn


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