If you plan on deducting any moving or vehicle expenses on your 2018 tax return, there are some changes coming. The IRS released information on the changes from the Tax Cuts and Jobs act that affect moving expenses, vehicle expenses, unreimbursed employee expenses and depreciation limits for some vehicles. Here are some changes you should be aware of:
The Tax Cuts and Jobs Act suspends the deduction for moving expenses for tax years beginning after Dec. 31, 2017 until January 1st, 2026. During that time, the IRS will not allow deductions for use of an automobile as part of a move using the mileage rate. The suspension doesn’t apply to members of the armed forces on active duty who move because of a military order related to a permanent change of station.
Unreimbursed Employee Expense Deduction
The new tax law also suspends all miscellaneous itemized deductions subject to the 2% of adjusted gross income floor. This will affect expenses like union dues, uniforms, deduction for business-related meals, travel and entertainment that the employer isn’t reimbursing. That also means the business standard mileage rate can’t be used to claim an itemized deduction for unreimbursed employee travel expenses in taxable years.
The Tax Cuts and Jobs Act raises the depreciation limitations for passenger automobiles that have been placed in service after Dec. 31, 2017, for the purposes of calculating the allowance under a fixed and variable rate plan. The maximum standard cost can’t exceed $50,000 for passenger cars, trucks and vans.
If you’re not sure if these changes affect you or if you need help figuring out your deductions, Polston Tax can help! Our team of tax accountants can help you figure out the best credits for your financial situation. Call us today at 844-841-9857 or click below for a free consultation.