Congress quietly restores employee tax deduction—but only for 3 years

What it does

This bill restores a tax deduction for employees' unreimbursed business expenses (food, lodging, travel, transportation) that was eliminated by the 2017 Tax Cuts and Jobs Act. For tax years 2025–2027, employees can deduct 85% of these expenses as miscellaneous itemized deductions, subject to a 1% floor instead of the normal 2% floor. The bill also allows taxpayers to claim refunds for overpayments from prior years if they would have qualified under this restored deduction.

Why we flagged it

The bill's sole function is to restore a specific tax deduction (unreimbursed employee business expenses) that was eliminated by prior legislation, with a temporary 3-year window and a partial allowance (85% of expenses).

What the text implies

• The 85% deduction cap (rather than 100%) means employees bear 15% of qualifying expenses as a permanent tax cost, even during the 3-year window.
• The 1% floor (vs. the normal 2%) is more favorable but still requires total miscellaneous deductions to exceed 1% of adjusted gross income before any deduction is allowed.
• Sunset after 2027 means the deduction expires unless Congress acts again; employees lose the benefit permanently unless the bill is extended.
• The retroactive effective date (as if included in TCJA 2017) combined with the 1-year refund window may allow some taxpayers to claim refunds for 2017–2024 tax years if they filed amended returns, but only within the statute-of-limitations window.

Section numbers refer to the bill text the analysis read — linked under Primary records below.

Who it affects

Employees who incur unreimbursed business expenses (travel, meals, lodging) regain a tax deduction that was eliminated in 2017, reducing their taxable income and tax liability. The benefit is narrowly targeted to workers with such expenses, but for those who qualify, it is a direct reduction in tax burden.

Who stands to gain

• Individual employees with unreimbursed business expenses
• Self-employed individuals (if they qualify as employees under the provision)

Named in the bill

Internal Revenue Code Section 67(g), Public Law 115–97 (Tax Cuts and Jobs Act of 2017), U.S. Department of Treasury, IRS

Where it stands

1 cosponsor: 1 Republicans.

• Feb 27, 2025 — Introduced · Congress.gov: “Introduced in House”
• Feb 27, 2025 — Referred to House Committee on Ways and Means · Congress.gov: “Referred to the House Committee on Ways and Means”

Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.

Money around this bill

2 lobbying clients named this bill on 3 disclosure filings across 2 quarters, Dec 2025 to Jun 2026. Those filings disclosed $106,396 in lobbying spend. A filing names 17 bills on average, so that figure is what each filing reported, not a share belonging to this bill.

More lobbying clients named this bill than 41% of bills with at least one filing.

Glenn Grothman, the sponsor, reported $325,000 in PAC receipts in the 2026 cycle.

• Healthcare Institute of New Jersey — $86,396 on 2 filings
• Medical Device Manufacturers Association — $20,000 on 1 filing

Lobbying Disclosure Act filings through Jul 15, 2026. A filing shows who paid to lobby on a bill it names, not what changed.