Employee Business Expense Deduction Reinstatement Act of 2023
Impact
Should this bill be enacted, it would modify existing tax laws to enable employees to deduct a significant portion (85%) of their unreimbursed expenses from their taxable income. This change effectively revises the current tax framework established by the Tax Cuts and Jobs Act of 2017, which had limited or eliminated many of these deductions. The reinstatement of these deductions is expected to provide financial relief to employees who might otherwise absorb the full costs of necessary job-related expenses.
Summary
House Bill 5802, named the Employee Business Expense Deduction Reinstatement Act of 2023, aims to amend the Internal Revenue Code of 1986 to allow unreimbursed employee expenses to be counted as miscellaneous itemized deductions. Specifically, the bill seeks to reinstate deductions for expenses related to meals, lodging, travel, or transportation incurred by employees while performing their jobs. This reinstatement is structured to support employees facing financial burdens associated with job-related expenditures that are not reimbursed by employers.
Contention
As with many tax-related legislative proposals, there are points of contention surrounding HB5802. Proponents of the bill argue that allowing these deductions supports the workforce by reducing the personal financial burden on employees who incur costs for their jobs. On the other hand, opponents may question the fiscal implications of reinstating such deductions, particularly in terms of potential revenue loss for the federal government. There is also concern about how these changes might complicate the tax preparation process for individuals and affect overall tax equity.
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To amend the Internal Revenue Code of 1986 to allow a deduction for investment advisory expenses of certain funeral and cemetery trusts during suspension of miscellaneous itemized deductions, and for other purposes.