I
119THCONGRESS
1
STSESSION H. R. 557
To amend the Internal Revenue Code of 1986 to establish a deduction
for certain amounts received as a bonus.
IN THE HOUSE OF REPRESENTATIVES
JANUARY20, 2025
Mr. B
ACONintroduced the following bill; which was referred to the Committee
on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to establish
a deduction for certain amounts received as a bonus.
Be it enacted by the Senate and House of Representa-1
tives of the United States of America in Congress assembled, 2
SECTION 1. SHORT TITLE. 3
This Act may be cited as the ‘‘Working Class Bonus 4
Tax Relief Act of 2025’’. 5
SEC. 2. DEDUCTION FOR BONUSES. 6
(a) I
NGENERAL.— 7
(1) D
EDUCTION ALLOWED .—Part VII of sub-8
chapter B of chapter 1 of the Internal Revenue Code 9
of 1986 is amended by redesignating section 224 as 10
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section 225 and by inserting after section 223 the 1
following new section: 2
‘‘SEC. 224. BONUSES. 3
‘‘(a) I
NGENERAL.—There shall be allowed as a de-4
duction an amount equal to so much of any bonus received 5
by an individual as does not exceed 15 percent of such 6
individual’s non-bonus wages from the same employer for 7
the taxable year. 8
‘‘(b) L
IMITATION.—No deduction shall be allowed 9
under subsection (a) for any taxpayer whose adjusted 10
gross income for the taxable year exceeds— 11
‘‘(1) in the case of a married couple filing joint-12
ly, $200,000, 13
‘‘(2) in the case of a head of household, 14
$150,000, or 15
‘‘(3) in the case of any other individual, 16
$100,000. 17
‘‘(c) T
ERMINATION.—No deduction shall be allowed 18
under subsection (a) for any amounts received after De-19
cember 31, 2029.’’. 20
(2) C
ONFORMING AMENDMENT .—The table of 21
sections for part VII of subchapter B of chapter 1 22
of such Code is amended by redesignating the item 23
relating to section 224 as relating to section 225 24
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and by inserting after the item relating to section 1
223 the following new item: 2
‘‘Sec. 224. Bonuses.’’.
(b) DEDUCTIONALLOWED TO NON-ITEMIZERS.— 3
Section 63(b) of the Internal Revenue Code of 1986 is 4
amended by striking ‘‘and’’ at the end of paragraph (3), 5
by striking the period at the end of paragraph (4) and 6
inserting ‘‘and’’, and by adding at the end the following 7
new paragraph: 8
‘‘(5) the deduction provided in section 224.’’. 9
(c) N
ON-APPLICATION OF CERTAINLIMITATIONS 10
FORITEMIZERS.— 11
(1) D
EDUCTION NOT TREATED AS A MISCELLA -12
NEOUS ITEMIZED DEDUCTION .—Section 67(b) of the 13
Internal Revenue Code of 1986 is amended by strik-14
ing ‘‘and’’ at the end of paragraph (11), by striking 15
the period at the end of paragraph (12) and insert-16
ing ‘‘, and’’, and by adding at the end the following 17
new paragraph: 18
‘‘(13) the deduction under section 224 (relating 19
to bonuses).’’. 20
(2) D
EDUCTION NOT TAKEN INTO ACCOUNT 21
UNDER OVERALL LIMITATION .—Section 68(c) of the 22
Internal Revenue Code of 1986 is amended by strik-23
ing ‘‘and’’ at the end of paragraph (2), by striking 24
the period at the end of paragraph (3) and inserting 25
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‘‘, and’’, and by adding at the end the following new 1
paragraph: 2
‘‘(4) the deduction under section 224 (relating 3
to bonuses).’’. 4
(d) W
ITHHOLDING.—The Secretary of the Treasury 5
(or the Secretary’s delegate) shall modify the tables and 6
procedures prescribed under section 3402(a) of the Inter-7
nal Revenue Code of 1986 to take into account the deduc-8
tion allowed under section 224 of such Code (as added 9
by this Act). 10
(e) E
FFECTIVEDATE.—The amendments made by 11
this section shall apply to amounts received after the date 12
of the enactment of this Act. 13
Æ
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