How to Handle Miscellaneous Itemized Deductions under the Tax Cuts and Jobs Act of 2017

What is the impact of the Tax Cuts and Jobs Act of 2017 on miscellaneous itemized deductions?

Under the Tax Cuts and Jobs Act of 2017, what happens to miscellaneous itemized deductions subject to the 2% floor?

Answer:

Following the Tax Cuts and Jobs Act of 2017, miscellaneous itemized deductions subject to the 2% floor have been suspended for tax years 2018 through 2025.

After the Tax Cuts and Jobs Act of 2017, there were significant changes to the tax code that affected miscellaneous itemized deductions. Any deductions that were previously subject to the 2% floor, such as unreimbursed employee expenses, tax preparation fees, and investment expenses, were suspended for tax years 2018 through 2025. This means that individuals like Zach, who have miscellaneous itemized deductions totaling $450, will not be able to deduct these amounts from their taxable income during this period. This change was implemented to simplify the tax code and reduce the number of taxpayers who previously benefited from these deductions.