In its efforts to simplify the tax code, Congress included provisions in The Tax Cuts and Jobs Act of 2017 that increased the standard deduction to $12,000 for individuals ($24,000 for married couples) and either modified or eliminated many itemized deductions. As a result, taxpayers and their professional tax advisers are currently exploring ways to best take advantage of the itemized tax deductions still available to them. While record keeping however, it is important to be wary of these popular deductions that will no longer count.
Businesses used to be entitled to a $255 deduction per month for each employees’ parking and transit passes. This, however, has been done away with, and employees can expect their employer to stop offering the benefit as a result of reduced tax savings.
Now, expenses related to employment agencies, classes taken to develop professionally and improve knowledge, and other expenses associated with searching for employment are no longer deductible.
Starting 2018, it would be a great idea to ask employers to consider covering these expenses in some way. Previously, employees were able to deduct any job-related expenses such as the following: meals, travel expenses, conferences, uniforms, work related supplies, home office, subscriptions, union dues, license fees, continued education, and anything else work-related that was not reimbursed by employers. Now, only teachers are entitled to a $250 deduction for school supplies paid out of pocket.
Money paid for tax software utilization or to tax preparers is no longer a tax-deductible expense.
Many regular donors to universities/colleges receive sporting or events tickets and benefits in exchange. However, the reported donation must now be reduced by the value of whatever has been exchanged. Therefore, the money donated will be seen as a partial donation, and a partial purchase.
Previous to tax year 2018, the personal exemption of $4,050 per person, was a pleasant aid in reducing taxes. This exemption has been totally done away with. However, the standard deduction being doubled should promptly make up for this loss and some of the losses of several other deductions.
By Ricky M. Hackler