Tax Preparation Deductions Under the TCJA

In the past, taxpayers were able to deduct fees and expenses related to preparing or having their tax returns professionally prepared, providing that they itemized their deductions. However, due to the recent changes to the Tax Cuts and Jobs Act (TCJA), most individuals are no longer able to claim this deduction.    

The key word there, though, is “most.” Some taxpayers may still be able to qualify.  

Self-Employed Taxpayers  

One group that may still be able to claim this deduction is the self-employed. If you work full or part-time on your own, you may qualify if you meet the following requirements:  

●       You filed as a sole proprietor with a Schedule C

●       You received income from a rental property and/or royalties, as reported on a Schedule E

●       You were a farmer who filed a Schedule F  

Statutory Employees  

If you were classed as a statutory employee and filed or will file a Schedule C, you may also be eligible for this deduction.  

This applies to:  

●       Drivers that distribute non-milk food and beverages or who pick up and/or deliver dry cleaning or laundry and who are paid on commission

●       Life insurance sales professionals

●       Full-time salespersons who do not have an alternate primary source of income.  

The Importance of Professional Tax Help  

If you fall into one of the categories described above, it may or may not be in your best interest to claim this deduction. There may be other ways for you to save money even without having this deduction, which, in most cases, is a fairly low deduction anyway.  

Furthermore, qualifying, even if you feel sure you meet the requirements, is more complex than it might sound. Thus, you should never just assume that you qualify without a careful and thorough understanding of the tax law and how it applies or does not apply to you.  

For this reason, if you have any doubt about whether or not you qualify for this or any other deduction, or if you have other questions or concerns, remember that it’s alway best to seek the help and expert advice that only a tax professional can provide.