Bill > HR557

This bill introduces a new tax deduction specifically for bonuses received by employees, allowing individuals to deduct up to 15 percent of their bonus amount from their taxable income, with income-based limitations. The deduction is available for bonuses received between the bill's enactment and December 31, 2029, and applies to taxpayers based on their filing status: married couples filing jointly can claim the deduction if their adjusted gross income is $200,000 or less, heads of household can claim it with incomes up to $150,000, and other individuals can claim it with incomes up to $100,000. The bill modifies the Internal Revenue Code to create this new section (Section 224), ensures the deduction is available to both itemizers and non-itemizers, and prevents the bonus deduction from being classified as a miscellaneous itemized deduction or being subject to overall itemized deduction limitations. The Treasury Department is required to update withholding tables and procedures to account for this new deduction. The goal appears to be providing targeted tax relief for working-class individuals who receive bonuses, potentially offering them some additional financial flexibility by reducing their tax burden.

Budget and Finance

https://www.congress.gov/bill/119th-congress/house-bill/557/all-info