The Tax Cuts and Jobs Act (TCJA) includes the following changes to moving, mileage, and travel expenses:
Move-related Vehicle Expense
The new law suspends the deduction for tax years beginning after December 31, 2017, through January 1, 2026. During the suspension, no deduction is allowed for use of an auto as part of a move using the mileage rate listed in IRS Notice 2018-03. This does not apply to members of the Armed Forces on active duty who move related to a permanent change of station.
Unreimbursed Employee Expenses
TCJA also suspends all miscellaneous itemized deductions subject to the 2% of adjusted gross income floor. This change affects unreimbursed employee expenses such as uniforms, union dues, and the deduction for business-related meals, entertainment, and travel.
Standard Mileage Rates for 2018
The standard mileage rates for the use of a car, van, pickup, or panel truck for 2018 remain as follows:
- 54.5 cents for every mile of business travel driven, a 1 cent increase from 2017.
- 18 cents per mile driven for medical purposes, a 1 cent increase from 2017.
- 14 cents per mile driven in service of charitable organizations, which is set by statute and remains unchanged.
Increased Depreciation Limits
The recent legislation also increases the depreciation limitations for passenger autos placed in service after December 31, 2017, for purposes of computing the allowance under a fixed and variable rate plan. The maximum standard automobile cost may not exceed $50,000 for passenger automobiles, trucks, and vans placed in service after December 31, 2017.
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