An eligible educator is a K teacher, instructor, counselor, principal, or aide who worked at least hours in a school that provides elementary or secondary education as determined by state law. An ordinary expense is one that is common and accepted in your educational field. A necessary expense is one that is helpful and appropriate for your profession as an educator. While not a dollar for dollar deduction for your overall union dues, this deduction will offset your taxable income if you itemize your New York state income taxes.
Learn more at nysaflcio. E-mail or Member ID. Corporations receive large, permanent tax cuts, including steeply discounted tax rates on their past overseas profits. The law implemented a lower rate on U. Meanwhile, pass-through businesses—which do not pay corporate tax—received a special new tax deduction, overwhelmingly benefiting the wealthy owners of such entities.
High-income Americans received larger tax cuts, even as a share of their income, than middle- and lower-income Americans. The law also reduced or eliminated many individual tax benefits, such as the itemized deduction for unreimbursed employee expenses, which includes union dues. Even before the major provisions of the TCJA went into effect in , the deduction of union dues was subject to limitations. In , tax law only allowed union dues to be deducted as an unreimbursed business expense.
By contrast, the expenses that companies incur in setting worker pay—including negotiating with unions and even resisting unionization—have always been fully deductible.
Instead of balancing the playing field, then, the TCJA further tilted it against workers by eliminating the deduction for unreimbursed employee expenses, including union dues.
Union wages are about 12 percent higher for unionized workers than their nonunionized counterparts. Unions also motivate their members to participate in U.
Together, these facts suggest not only that unions are an important check on corporate power but also that they play a critical role in addressing inequality and boosting the prosperity of the middle class. Many factors have contributed to this erosion in union membership and power, including changes in the economy, such as the decline in U. The 60 million workers covered under these agreements are left without real access to the courts, as the agreements often prohibit them from bringing class and collective actions to resolve workplace disputes in judicial or arbitral forums.
Unions are essential to holding corporations accountable for inequitable treatment of workers and wage disparities between workers and CEOs. Allowing an above-the-line deduction—one that could be taken regardless of whether a worker chooses the standard deduction or itemized deductions—for union dues would increase tax fairness for workers.
The current tax treatment of union dues is not only fundamentally unfair but also inconsistent with basic income tax principles. A basic principle of income taxation is that taxpayers should be able to deduct the costs of earning their income. This ensured more equal treatment across taxpayers. The deduction for unreimbursed business expenses did not quite achieve that parity because of the 2 percent of AGI floor, but it did bring the tax treatment closer to parity.
Many unreimbursed business expenses were allowed under the unreimbursed business expense deduction—not only union dues but also certain business travel costs, qualifying home office costs, and continuing education costs, as well as tools, supplies, and clothing needed for work.
In fact, the congressional Joint Committee on Taxation considers the deduction for employee business expenses to be part of the normal structure of the individual income tax, not a tax expenditure. An above-the-line deduction for union dues would be fairer than not only the current tax treatment, which allows no deduction for union dues, but also previous tax law, which limited the ability to deduct union dues to those who itemized deductions.
There are various types of union dues and professional membership dues you can deduct when filing your taxes. You can claim dues related to your employment paid by you or paid on your behalf that were included as part of your income during the year. By the end of February, each employer must issue employees T4 slips for employment income earned during the previous tax year.
The amount of union dues eligible to be claimed as a tax deduction is on your T4 slip in box Your employer may show a tax deduction for union dues on your T4 slip and you may also receive a tax receipt from the professional association or organization the dues are related to.
Make sure the amounts match and only claim them once.
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