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15805: 3903 - Moving, Mileage, and Travel Expense Deductions (Drake18 and Future)

1040 Individual

How has the Tax Cuts and Jobs Act affected moving, mileage, and travel expense deductions starting in Drake18?

The Tax Cuts and Jobs Act changed the rules for deducting expenses for move-related expenses, un-reimbursed employee expenses, and standard mileage rates. Some states did not conform to the federal law changes and may still allow deductions that are disallowed at the federal level. 

Moving expense deductions are suspended from December 31, 2017, through January 1, 2026. This disallows any mileage claim that would have previously been included with moving expenses. An exception is allowed for active duty military personnel who move pursuant to a military related order or change of situation.

Itemized deductions subject to the 2% floor of adjusted gross income are also suspended by Tax Cuts and Jobs Act after December 31, 2017, through January 1, 2026. This includes un-reimbursed employee expenses (such as uniforms and union dues) and deductions for business related meals, entertainment and travel (including miles). Some states may still allow these deductions. 

Note: The calculation for individuals that are part of a reserve portion of the Armed Forces, state or local government officials paid on a fee basis, and certain performing artists maintain their ability to report un-reimbursed employee travel expenses as an adjustment to income on Form 1040, line 24.

Public Law 115-97 (section 13202) increased the maximum cost of passenger automobiles, vans and trucks placed in service after December 31, 2017, not to exceed $50,000, as opposed to the previous $27,300 for passenger vehicles and $31,000 for trucks and vans.

Note: Taxpayers always have the option of calculating actual cost of using their vehicle rather than calculating expenses using the standard rates, however, they may not use the standard rates after using any Modified Accelerated Cost Recovery (MACRS) depreciation method, or if a Section 179 deduction has been claimed on the vehicle.

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