2019 Mileage rates and tax law changes

 

The IRS has released the new mileage reimbursement rates for 2019. For business-related travel, the new rate is $0.58 per mile (up from $0.545 last year). Driving for medical may be deducted at $0.20/mile and mileage for service to a charitable organization is unchanged at $0.14/mile. Mileage for moving expenses is no longer deductible.

Remember – under the new tax law, miscellaneous deductions (which includes unreimbursed employee expenses and home office deductions) are no longer deductible. This lost deduction begins for the 2018 tax year. Therefore, we recommend that employees get reimbursed for business mileage and business expenses. If, however, you file a schedule C, you can still deduct the mileage and home office deductions. This applies to the self-employed, evangelists and guest speakers.

Charitable donations are now deductible up to 60% of adjusted gross income (prior limit was 50%).

The 2019 HSA contribution limits increased to $3,500 for an individual and $7,000 for a family. If you are 55 or older, you can contribute an additional $1,000.

Finally, if the government shutdown continues, the IRS will be issuing refunds (previous reports said that they would delay sending refunds). To avoid penalties, you should also still file your return and pay any taxes due by the April 15 deadline.

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