The Second Job Tax Relief Act of 2024 would allow workers to exclude income from a second job from federal income tax and payroll taxes, provided they meet certain conditions. Under the bill, eligible taxpayers could designate one employer as their primary employer (based on working at least 2,080 hours there annually) and then exclude compensation from any other employment from taxation. The tax break would phase out for higher earners, beginning to disappear once modified adjusted gross income exceeds $100,000 for single filers or $150,000 for married couples filing jointly, and disappearing completely at incomes $50,000 higher than those thresholds. To prevent loss of revenue to Social Security, Medicare, and unemployment insurance trust funds, the bill includes appropriations from the general treasury to compensate these programs for the reduced payroll tax collections. The provision would sunset after five years, meaning it would expire for income earned five years after the bill becomes law.
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