The Tax Cuts and Jobs Act added a pile of new tax breaks for us to enjoy, but it also repealed some nice deductions. If you qualify to take the following tax breaks in 2017, get them while you can, because your 2017 tax return is your last shot at them.
1. Moving expenses
You can deduct your moving expenses for 2017 if the move was work-related. Specifically, if you change jobs and your new workplace is at least 50 miles farther away from your home than your old office was, then you can deduct the cost of moving to a new home to be near your new job.
While this deduction is tricky to qualify for, it's also a good one, because it's one of the few tax breaks that can lower your adjusted gross income (AGI) for the year. This not only saves you some income tax, but it can also make you eligible for other tax breaks that are based on your AGI. It's also not an itemized deduction, so you can take it along with the standard deduction.
To claim the moving expense deduction for 2017, fill out Form 3903 (one of the few relatively simple tax forms) and transfer the total to line 26 of your Form 1040. You can either deduct the actual moving costs or use the IRS "safe harbor" amount of $0.17 per mile.
2. Unreimbursed employee expenses
When you spend money on something related to your job and your employer doesn't repay you for it, that's an unreimbursed employee expense. After 2017 you'll no longer be able to get a tax break for those expenses, so be hyper-vigilant about getting reimbursed for any job-related expenses in the future.
To claim a deduction for these expenses, you fill out Form 2106 (or Form 2106-EZ if you didn't get any reimbursements from your employer and you're using the standard mileage rate for any vehicle expenses). Once you've completed the form, transfer the total to line 21 of your Schedule A.
Note that in order to claim unreimbursed employee expenses, you'll need to itemize deductions. If you don't have a substantial amount of other itemized deductions to claim -- namely, the mortgage interest deduction, the medical expense deduction, or the charitable contribution deduction -- then you may be better off skipping this particular tax break and taking the standard deduction instead.
3. Miscellaneous itemized deductions
In addition to the big itemized deductions, Schedule A allowed you to claim a number of specialized smaller deductions, all of which were subject to a 2% AGI floor. That means that when you claimed these deductions, you had to subtract 2% of your AGI for the year from your total deduction. For example, if you had $1,600 in miscellaneous itemized deductions, and your AGI for the year was $50,000, then you would subtract 2% of $50,000 (which is $1,000) from your $1,600 total and claim the remaining $600 on your Schedule A.
After 2017, every one of the miscellaneous itemized deductions will be gone, so if you're planning to itemize deductions for the year, don't miss out on these little ones. The miscellaneous itemized deductions include investment expenses, safe-deposit box fees, tax advice fees, and hobby expenses. IRS Publication 529 has a complete list of all the miscellaneous itemized deductions, but remember: 2017 is the last year that you can take any of these.
To claim your miscellaneous itemized deductions, you add up all the amounts and write them on line 23 of your Schedule A. There's a space to the right of this field that you can use to write in the type of miscellaneous expenses you're claiming. The Schedule A will walk you through the process of subtracting 2% of your AGI from the related deductions and calculating the result.
Given that the Tax Cuts and Jobs Act nearly doubled the standard deduction, it's highly likely that you won't want to itemize your deductions starting in 2018. That being the case, you probably won't be able to take the miscellaneous itemized or employee expense deductions anyway, so losing these tax breaks isn't as bad as it might seem. Still, if you can claim these deductions for 2017, you'll be able to knock at least a few dollars off your tax bill -- and that's enough to bring a smile to any taxpayer's face.