Unreimbursed Business Expenses for 2018

[exit15w]

My understanding of the new tax reform law is that unreimbursed business expenses such as mileage, tolls, parking, home office, entertainment etc. are no longer deductible if you are an employee. I am an outside sales rep that is responsible for all business expenses. I am an employee, not a W-9. Is there any way for me to estimate what my tax liability will be when I file my 2018 federal tax return? 

[Carl]

Your understanding is correct, for a W-2 employee. You need to have a discussion with your employer on this. If your employer will start reimbursing you, then if they do *NOT* use an accountable plan, what they reimburse you is included in box 1 of your W-2 and you pay taxes on it. It's not deductible by you on your personal 1040 tax return.

If your employer does or will use an accountable plan, then what they reimburse you is "NOT" included in box 1 of your W-2, so it's not taxable income to you. But under an accountable plan it is a tax deduction for the employer. So it would be advantageous for both you and the employer if they agree to reimburse you under an accountable plan.

[exit15w]

Carl, thank you for your reply. Apparently, news of this issue has spread like wildfire throughout my company in the last 72 hours. Unfortunately, the sales force has been told no changes will be made to the expense policy and we will be on our own come tax time. I guess there quite a few of us who are going to have to make some tough choices. Once again, thank you. 

[Carl]

Somebody needs to "take charge" for those affected and do some homework. Research the IRS website for the differences between an "accountable" reimbursement plan, and a non-accountable plan. Depending on the size of the sales force affected, negotiations for 2019 may be possible, and also gives time for folks to start seeking other jobs or lines of work if the employer won't at least have a seat at the table.