Second-job income gets a tax break—funded by general revenues.

What it does

This bill excludes income from a second job from federal income tax and payroll taxes (Social Security, Medicare, unemployment) for workers earning up to $100,000 (or $150,000 if married filing jointly), with the exclusion phasing out above those thresholds. The benefit expires after 5 years. The bill also appropriates general-fund money to Social Security and Medicare trust funds to offset the revenue loss from the tax exclusion.

Why we flagged it

The bill's core mechanism is a narrow, time-limited income-tax exclusion for workers' second-job earnings, funded by general-revenue appropriations to trust funds. It is straightforward tax policy, not a hidden rider or broad deregulation.

What the text implies

• The exclusion applies only to secondary employment, not primary employment, creating an incentive structure that may favor workers with multiple jobs over those with single full-time employment.
• The phase-out threshold ($100k/$150k modified AGI) means the benefit is most valuable to middle-income workers; high-income workers lose it entirely, and low-income workers may not have secondary income to exclude.
• General-fund appropriations to trust funds (Social Security, Medicare, unemployment) reduce the fiscal pressure on those programs but increase general-fund deficits, potentially crowding out other spending.
• The 5-year sunset means workers cannot rely on this benefit for long-term financial planning; reinstatement would require new legislation.

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

Who it affects

Workers with second jobs receive a direct tax benefit (lower federal tax burden), which is a concrete gain for that group. However, the bill funds the trust-fund shortfall from general revenues, shifting the cost to all taxpayers and potentially reducing funds available for other priorities. The benefit is narrowly targeted (only secondary employment, only up to income thresholds) and temporary (5-year sunset), limiting its scope.

Who stands to gain

• workers with secondary employment (income earners)

Named in the bill

Internal Revenue Code of 1986, Federal Old-Age and Survivors Insurance Trust Fund, Federal Disability Insurance Trust Fund, Federal Hospital Insurance Trust Fund, Social Security, Medicare, Unemployment Insurance

Where it stands

• Jan 20, 2025 — Introduced · Congress.gov: “Introduced in House”
• Jan 20, 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.