Wondering if you can still deduct union dues on your taxes in 2025? The short answer is no — unless you’re self-employed. The Tax Cuts and Jobs Act (TCJA) of 2017 eliminated the federal tax deduction for union dues, and it hasn’t returned. However, self-employed workers may still qualify in some states, so it’s worth checking with a financial advisor to see if state-level deductions apply.
What Are Union Dues?
Union dues are fees that members pay to keep their union running. These funds typically cover the union’s operations, such as negotiations, member support and administrative costs. Union dues are generally 1% to 2% of an employee’s salary, but this amount could change depending on the industry, union and location.
Are Union Dues Tax-Deductible on Federal Returns?
No, union dues are not tax-deductible on federal tax returns. The one exception is if you’re self-employed. You can deduct union dues as a business expense on Schedule C.
Who Can Still Deduct Union Dues?
You can deduct union dues in two scenarios — if you’re self-employed, you can claim them on your federal tax return. In addition, some states allow deductions for union dues on state tax returns.
Self-Employed Workers
Under the TCJA of 2017, employees can no longer deduct union dues as miscellaneous itemized deductions for tax years 2018 through 2025.
The one exception is for self-employed workers, who can deduct union dues as a business expense on Schedule C.
State-Level Deductions
Some states allow for the deduction of union dues on state tax returns. For example, Maryland and Delaware allow union members to claim the deduction, while Hawaii and Oregon also provide similar options in some cases.
To see if your state allows it, you can check this database.
How To Deduct Union Dues
Before you begin, make sure you have documentation of all union dues paid throughout the year. This information is often included on your paycheck or provided by your union at year’s end.
Federal for Self-Employed Workers
If you’re self-employed, here’s how to deduct union dues on your federal return:
- Step 1: Complete Schedule C (Profit or Loss from Business) as part of your tax return.
- Step 2: In Part II of Schedule C, list union dues under “Other Expenses” or “Dues and Subscriptions,” if applicable.
- Step 3: Report the total amount of union dues paid for the year.
State Returns
If your state allows deductions for union dues, the process typically involves:
- Step 1: Check if your state tax return includes a section for itemized deductions or unreimbursed employee expenses.
- Step 2: List the total amount of union dues paid on the relevant line of your state tax form.
- Step 3: Attach any additional forms or schedules your state requires to claim these deductions.
What Happens After 2025?
The TCJA provision prevents most union members from deducting union dues from their federal taxes. However, this provision is set to expire in 2025. Union members will need to watch for legislation for updates.
Other Tax Breaks Union Members May Qualify For
Although most union members can’t deduct union dues, there are other tax breaks that may still be applicable.
| Tax Break | Who Qualifies | Federal or State |
Amount / Benefit |
|---|---|---|---|
| Lifetime learning credit | Union members taking job-related courses or trainings | Federal | Up to $2,000 per year |
| Retirement contributions | Individuals with access to retirement accounts | Federal | Lowers taxable income |
| Health and medical expenses | Workers with union health plans | Federal | HSA or FSA tax savings; Deduct expenses above 7.5% of AGI |
Pros and Cons of Deducting Union Dues
Before you deduct union dues, it’s worth weighing the potential benefits and drawbacks.
Pros
- Reduces taxable income: Deducting union dues will reduce a taxpayer’s taxable income.
- Encourages union participation: Having deductible union dues may encourage more individuals to join a union.
- Offsets membership costs: The deduction can offset the costs of the union’s membership dues.
Cons
- Doesn’t apply to standard deductions: Most people use the standard deduction, and to get the union dues deducted, you would have to itemize your deductions.
- More calculations and paperwork: Itemizing your union deduction will add more paperwork and time to your taxes.
Final Take
Since the TCJA of 2017 became law, union dues are not tax-deductible. This may change in 2025 if the law is not extended. However, TCJA did not impact self-employed workers who may still qualify for a union dues deduction under Schedule C.
Also, some individual states allow for union dues deduction. Check your individual state’s legislation for the rules on claiming a tax deduction.
Union Dues FAQ
Got questions about union dues and taxes? Here are quick answers to some of the most common ones:- Are union dues deductible for retirees?
- Union dues are not tax-deductible for retirees on a federal tax return — unless the individual is self-employed. Certain states, however, allow for a state tax deduction.
- Why are union dues no longer deductible?
- In 2017, TCJA enacted legislation prohibiting union dues from being tax-deductible.
- Can you deduct union dues from state taxes?
- Yes, certain states allow you to deduct union dues from your state tax returns.