What is 'IRS Publication 529 - Miscellaneous Deductions'

IRS Publication 529 - Miscellaneous Deductions is a document published by the Internal Revenue Service (IRS) detailing miscellaneous expenses that can be reported as itemized deductions on Schedule A of Form 1040 or Form 1040NR. The deduction is calculated by subtracting 2 percent of the adjusted gross income (AGI) from the total amount of expenses listed after any other deduction limit. Expenses can be claimed if they are considered ordinary and necessary in a particular line of business.

BREAKING DOWN 'IRS Publication 529 - Miscellaneous Deductions'

IRS Publication 529 - Miscellaneous Deductions explains how taxpayers can claim expenses as itemized miscellaneous deductions. Miscellaneous deductions are often those that are not reimbursed by employers but are still incurred by employees. Some items which may seem ordinary and necessary may actually be considered personal expenses by the IRS, and thus not subject to a tax deduction.

Revisions to IRS Publication 529

The various expenditures that can be claimed under the IRS Publication 529 miscellaneous itemized deduction rule tend to change over time. Deductions that were allowable in one tax year could be phased out during the next. Therefore, it is very important that taxpayers and tax preparers remain current with the annual revisions to IRS Publication 529.

Miscellaneous Deductions and the Tax Reform Act

In December 2017, Congress passed the Tax Cuts and Jobs Act, one of the biggest tax reform bills of all time. The new legislation had a tremendous effect on how businesses and individuals are taxed, and miscellaneous deduction provisions were dramatically impacted.

For example, the new law suspended a number of miscellaneous itemized deductions through 2025, including deductions for moving expenses, except for active duty military personnel; home office expenses; licensing and regulatory fees; union dues; professional society dues; business bad debts; work clothes that are not suitable for everyday use and many others. Alimony payments will no longer be deductible after 2019; this change is permanent.

The reform also limited the mortgage interest deduction for married couples filing jointly, and it capped the deduction for state and local taxes at $10,000. Both of these changes are in effect through 2025.

The law left the charitable contributions deduction intact, with minor alterations, and the student loan interest deduction was not affected. Medical expenses in excess of 7.5% of adjusted gross income are deductible for all taxpayers, not just those aged 65 or older, in 2018; the threshold then reverts to 10%.

RELATED TERMS
  1. Itemized Deduction

    Itemized deductions are deductions that allow taxpayers to take ...
  2. IRS Publication 936

    A document published by the Internal Revenue Service (IRS) that ...
  3. Tax Deductible Interest

    The tax deductible interest is a borrowing expense that a taxpayer ...
  4. Above The Line Deduction

    An above the line deduction is an item that is subtracted from ...
  5. Educator Expenses Deduction

    The educator expenses deduction is an adjusted gross income deduction ...
  6. Interest Deduction

    Interest deduction causes a reduction in taxable income or revenues ...
Related Articles
  1. Taxes

    An Overview of Itemized Deductions

    Itemized deductions will mostly stay the same for 2017 tax year (medical deductions improve under the new tax bill). Big changes start in 2018.
  2. Taxes

    9 Ways the New Tax Law Affects Millennials

    The new tax bill, the Tax Cuts and Jobs Act, includes some important changes for Millennials.
  3. Taxes

    Calculating the Mortgage Interest Tax Deduction

    The amount of money you save by paying your mortgage off quickly will far exceed any benefit from the mortgage interest tax deduction.
  4. Small Business

    Writing off the Expenses of Starting Your Own Business

    Learn how to navigate the complicated rules for writing off the expenses of starting your own business. It could save you a lot of money.
  5. Taxes

    10 Tax Benefits for the Self-Employed

    Running your own business has both personal and financial perks.
  6. Taxes

    How To Deduct Your Job Search Expenses

    With approximately 12 million Americans out of a job right now, many people are spending significant dollars to be noticed by potential employers. Fortunately, some of these job-search costs ...
  7. Taxes

    5 Expenses You Want to Be Deductible But Aren't

    Here are five expenses that many taxpayers often try to claim only to find out that their deductions are denied.
  8. Taxes

    How To Claim Home Office Expenses

    There are many factors to determine what home office deductions can be made towards your small business. Planning ensures high deductions.
RELATED FAQS
  1. Are mutual fund expense ratios tax deductible?

    Learn under what circumstances mutual fund expense ratios and other investment-related expenses may be tax deductible under ... Read Answer >>
Trading Center