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Second Job Tax Relief Act of 2025
To amend the Internal Revenue Code of 1986 to exclude compensation from secondary employment for certain taxpayers from the income tax and payroll taxes.
Summary
This bill amends the Internal Revenue Code to exclude income from secondary employment (second jobs) from federal income tax and payroll taxes for qualifying taxpayers. A taxpayer may designate one primary employer (where they worked at least 2080 hours in a year) and exclude compensation from all other employers from gross income. The exclusion phases out for taxpayers with modified adjusted gross income above $100,000 ($150,000 for married couples filing jointly) and is fully eliminated at $150,000 ($200,000 for married couples). The bill also excludes secondary employment compensation from Social Security, disability insurance, hospital insurance, and unemployment tax calculations, and appropriates funds to replace lost revenues to the Social Security and Medicare trust funds. The provision expires five years after the bill's enactment.
AI-generated plain-language summary of the bill text — neutral, and may be imperfect. See the full text below for the exact wording.
Sponsor (1)
- Rep. Bacon, Don [R-NE-2] (R-NE)
Actions (2)
- Jan 20, 2025 Referred to the House Committee on Ways and Means. · house
- Jan 20, 2025 Introduced in House
Similar bills (6)
Bills with similar text or summary — includes reintroductions across Congresses. Ranked by semantic similarity of the bill text (computed locally); a neutral discovery aid, not a claim the bills are duplicates.
Text versions (1)
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Full text
IN THE HOUSE OF REPRESENTATIVES
January 20, 2025
Mr. Bacon introduced the following bill; which was referred to the Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to exclude compensation from secondary employment for certain taxpayers from the income tax and payroll taxes.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the “Second Job Tax Relief Act of 2025”.
SEC. 2. EXCLUSION OF COMPENSATION FOR CERTAIN SECONDARY EMPLOYMENT FROM INCOME AND PAYROLL TAX.
(a) In General.—Part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 139I the following new section:
“SEC. 139J. EARNED INCOME FROM ADDITIONAL EMPLOYMENT.
“(a) In General.—In the case of a qualifying taxpayer, gross income shall not include secondary employment compensation.
“(b) Phase-Out.—The amount of compensation excluded from gross income under subsection (a) (determined without regard to this subsection) shall be reduced (but not below zero) by the amount which bears the same ratio to the amount which is so excludable as—
“(1) the excess (if any) of—
“(A) the taxpayer’s modified adjusted gross income (as defined in section 36(b)(2)(B)) for such taxable year, over
“(B) $100,000 ($150,000 in the case of a married couple filing jointly), bears to
“(2) $50,000.
“(c) Secondary Employment Compensation.—
“(1) In general.—For purposes of this section, the term ‘secondary employment compensation’ means compensation received for employment during a taxable year with respect to which an individual has made an election under paragraph (2) for an employer other than the primary employer of such individual.
“(2) Primary employer.—
“(A) Election.—A taxpayer may elect to designate, with respect to a taxable year, a primary employer if such individual was compensated on an hourly basis for not less than 2080 hours of work by such employer.
“(B) Definition.—For purposes of this section, the term ‘primary employer’ means, with respect to a taxable year, an employer designated by the taxpayer under subparagraph (A).
“(d) Sunset.—Subsection (a) shall not apply to compensation earned in taxable years beginning after the date is that is 5 years after the date of the enactment of this section.”.
(b) Application to Employment Taxes.—
(1) Social security taxes.—
(A) In general.—Section 3121(a) of such Code is amended by striking “or” at the end of paragraph
(22), by striking the period at the end of paragraph
(23) and inserting “; or”, and by inserting after paragraph (23) the following new paragraph:
“(24) any amount of compensation which is excludable from gross income under section 139J.”.
(B) Trust funds held harmless.—There are hereby appropriated to the Federal Old-Age and Survivors Insurance Trust Fund, the Federal Disability Insurance Trust Fund, and the Federal Hospital Insurance Trust Fund amounts equivalent to the reduction in revenues to each such Trust Fund, respectively, by reason of the amendment made by subparagraph (A) (determined without regard to this subparagraph). Amounts appropriated by the preceding sentence shall be transferred from the general fund at such times and in such manner as to replicate to the extent possible the transfers which would have occurred to such Trust Fund had this section not been enacted.
(2) Unemployment taxes.—Section 3306(b) of such Code is amended by striking “or” at the end of paragraph (19), by striking the period at the end of paragraph (20) and inserting “; or”, and by inserting after paragraph (20) the following new paragraph:
“(21) any amount of compensation which is excludable from gross income under section 139J.”.
(3) Wage withholding.—Section 3401(a) of such Code is amended by striking “or” at the end of paragraph (22), by striking the period at the end of paragraph (23) and inserting “; or”, and by inserting after paragraph (23) the following new paragraph:
“(24) any amount of compensation which is excludable from gross income under section 139J.”.
(c) Clerical Amendment.—The table of sections for part III of subchapter B of chapter 1 of such Code is amended by inserting after the item relating to section 139I the following new item:
“Sec. 139J. Earned income from additional employment.”.
(d) Effective Date.—The amendments made by this section shall apply to amounts received after the date of the enactment of this Act. <all>
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