You’ve no doubt got questions about the effects of the recently passed tax act, and its effects on your business. Here are a few highlights that will affect the majority of our clients:
Beginning 1/1/18, the standard mileage rates for cars, vans, pickups, and panel trucks will be 54.5 cents per mile for business miles, 18 cents per mile for medical or moving purposes, and 14 cents per mile for charitable purposes.
Employee Business Expenses
Effective 1/1/18, unreimbursed employee business expenses are no longer deductible. Now would be a good time to review your reimbursement policy to be sure it is an accountable plan according to IRS standards.
Meals and Entertainment
The new act imposes stricter limits on the deductibility of meals and entertainment expenses. Below is a table showing the changes from 2017 to 2018 tax years.
2017 Tax Year
2018 Tax Year
|Meals – 50% deductible||Meals – 50% deductible|
|Event tickets, 50% deductible||Zero – There is no longer a deduction for entertainment expenses|
|Office Holiday Party
|100% Deductible||100% Deductible|
|Employee Travel Meals
|50% Deductible||50% Deductible|
|Meals Provided for Convenience of Employer||100% Deductible – within certain guidelines||50% Deductible – currently scheduled to become nondeductible after 2025 without additional legislation|