11 Ways Members of Congress Pay Taxes Differently From Regular Floridians

Members of Congress earn $174,000 a year as a base salary, have offices in two states (their home district or state, plus Washington, DC), and work under a tax code they themselves help write.

That unusual situation leads to some unusual tax rules.

Here are 11 ways Members of Congress pay taxes differently from regular Floridians and Americans across the country, all sourced from the Congressional Research Service, IRS publications, and federal law.

They’re Exempt From DC Area Income and Personal Property Taxes

Under federal law, Members of Congress who don’t represent Washington, DC, or the surrounding jurisdictions are immune from paying income or personal property taxes to DC, Maryland, or Virginia.

This applies even if they own a home, car, or other property in those jurisdictions while serving.

Members pay state taxes to their home state (the state that elected them), not the one where Congress happens to physically sit.

Regular Americans who move to the DC metro area for work pay local taxes to whichever jurisdiction they live in.

They Can Use Two Simplified Methods for Deducting Living Expenses

The IRS allows Members of Congress to use one of two simplified methods for calculating deductible living expenses in the Washington, DC, area.

Both methods involve a per-day rate tied to federal per diem figures.

Members can deduct expenses without keeping receipts, as long as they use one of the approved calculation methods.

Regular Americans who have a job that requires maintaining a second residence generally have to document expenses in detail and meet strict IRS substantiation requirements.

Their “Tax Home” Is Their Home District or State, Not Washington

For tax purposes, a Member of Congress’s “tax home” is their home state or district, not Washington, DC.

This matters because it changes how travel expenses are treated. Regular Americans who work in one location while living in another generally have their tax home at their workplace.

Members of Congress are specifically carved out of that rule. Their tax home is where they were elected, which means trips to Washington count as business travel.

It’s a small distinction, but it affects how their deductions get calculated.

Their Federal Salary Is Frozen But Still Taxed Like Regular Income

Rank-and-file Members of Congress earn $174,000 a year, a salary that’s been frozen since 2009 when Members voted against accepting automatic cost-of-living adjustments.

Leadership positions earn more. The Speaker of the House earns $223,500, while majority and minority leaders in both chambers earn $193,400.

All of this salary is subject to federal income tax at regular rates, Social Security (up to the annual wage cap), and Medicare.

The only thing different from regular high-earner pay is that the salary is set by federal law rather than negotiated with an employer.

They Lost Their Famous $3,000 Second Home Deduction in 2017

For decades, Members of Congress had a special $3,000 annual income tax deduction for maintaining a second residence in Washington, DC.

The deduction was first enacted in 1953 and never adjusted for inflation.

It was eliminated entirely by the Tax Cuts and Jobs Act of 2017.

This is the specific deduction that gets most frequently referenced in viral posts about Congressional “perks.” The perk hasn’t existed for almost a decade, but the posts keep circulating.

They Pay 8% of Their Salary Into Their Pension Plan

Members of Congress contribute 8% of their salary to the Federal Employees Retirement System (FERS), which is higher than what most federal employees contribute (typically around 4.4% for employees hired after 2014).

The pension formula itself is generous. A Member with 20 to 25 years of service can retire with up to 80% of their salary replaced.

Member pensions are taxable as regular income when paid out, just like any pension.

Members’ contributions to their own pension are pre-tax, which is standard for federal retirement plans.

They Have a 15% Cap on Outside Earned Income

Members of Congress can earn up to 15% of the Executive Schedule Level II salary in outside earned income.

For 2025, that cap was $33,285.

Regular Americans can earn as much outside income as they want (there’s no federal cap on second jobs for private sector workers).

Outside earned income that falls within the cap is taxed normally, but the cap itself is a tax-relevant restriction that doesn’t apply to almost anyone else.

They Can’t Accept Honoraria (Payments for Speeches or Articles)

Members of Congress have been prohibited from accepting honoraria since 1991.

An honorarium is a payment for giving a speech, writing an article, or making an appearance in an official capacity.

Regular Americans, including federal employees in most other positions, can accept honoraria and simply pay tax on them as ordinary income.

Members have to refuse these payments entirely or direct them to charity.

Their Healthcare Premiums Come Pre-Tax Through DC Health Link

Under the Affordable Care Act, Members of Congress and certain congressional staff can no longer use the Federal Employees Health Benefits Program (FEHB).

Instead, they purchase coverage through the DC Health Link (the local ACA marketplace), with the federal government contributing to premiums.

Like other employer health insurance, these premiums are generally paid pre-tax.

Regular Americans who buy individual coverage through an ACA marketplace without employer contribution generally can’t use pre-tax dollars the same way, unless they’re self-employed and qualify for a specific deduction.

They Can’t Use the Student Loan Repayment Program (But Their Staff Can)

Both the House and Senate operate student loan repayment programs for congressional employees, but Members themselves are specifically excluded from participating.

Staffers can receive up to $833 per month in student loan repayment.

Members pay off their own student loans out of their taxed income.

This is one of the rare cases where a Congressional perk exists for staff but not for the Members who vote on the policies.

Death Gratuities to Families Are Tax-Free Up to the Member’s Annual Salary

When a Member of Congress dies in office, their heirs receive a death gratuity equal to the Member’s annual salary.

These payments are tax-free to the recipient under Section 102 of the Internal Revenue Code (which treats gifts as non-taxable income).

From 2000 through 2025, these gratuity payments have cost taxpayers around $7 million.