12. Other — Publication 17 — Your Federal Income Tax

What’s New

Standard mileage rate. The 2025 rate for business use of a vehicle is 70 cents a mile.

Reminders

No miscellaneous itemized deductions al- lowed. You can no longer claim any miscellaneous itemized deductions. Miscellaneous itemized deductions are those deductions that would have been subject to the 2%-of-adjusted-gross-income (AGI) limitation. See Miscella- neous Itemized Deductions, later.

Fines and penalties. Rules regarding deducting fines and penalties have changed. See Fines and Penalties , later.

Introduction

This chapter explains that you can no longer claim any miscellaneous itemized deductions, unless you fall into one of the qualified categories of employment claiming a deduction relating to unreimbursed employee expenses. Miscellaneous itemized deductions are those deductions that would have been subject to the 2%-of-AGI limitation. You can still claim certain expenses as itemized deductions on Schedule A (Form 1040) or Schedule A (Form 1040-NR), or as an adjustment to income on Form 1040 or 1040-SR. This chapter covers the following topics.

Miscellaneous itemized deductions.
Expenses you can’t deduct.
Expenses you can deduct.
How to report your deductions.

You must keep records to verify your deductions. You should keep receipts,

mentary evidence. For more information on recordkeeping, see What Records Should I Keep? in chapter 1.

For these and other useful items, go to IRS.gov/ Forms .

Miscellaneous Itemized Deductions

You can no longer claim any miscellaneous itemized deductions that are subject to the 2%-of-AGI limitation, including unreimbursed employee expenses. However, you may be able to deduct certain unreimbursed employee business expenses if you fall into one of the following categories of employment listed under Un- reimbursed Employee Expenses next.

Unreimbursed Employee Expenses

You can no longer claim a deduction for unreimbursed employee expenses unless you fall into one of the following categories of employment.

Armed Forces reservists.
Qualified performing artists.
Fee-basis state or local government officials.
Employees with impairment-related work expenses.

Categories of Employment

You can deduct unreimbursed employee expenses only if you qualify as an Armed Forces reservist, a qualified performing artist, a fee-basis state or local government official, or an employee with impairment-related work expenses.

Armed Forces reservist (member of a re- serve component). You are a member of a reserve component of the Armed Forces of the United States if you are in the Army, Navy, Marine Corps, Air Force, or Coast Guard Reserve; the Army National Guard of the United States; or the Reserve Corps of the Public Health Service.

Qualified performing artist. You are a qualified performing artist if you:

Performed services in the performing arts as an employee for at least two employers during the tax year,
Received from at least two of the employers wages of $200 or more per employer,

547

575

587

946

Form (and Instructions)

Schedule A (Form 1040) Schedule A (Form 1040) Itemized

Deductions

2106

8839

2106 Employee Business Expenses

8839 Qualified Adoption Expenses

Schedule K-1 (Form 1041) Schedule K-1 (Form 1041) Beneficiary’s

Share of Income, Deductions, Credits, etc.

Had allowable business expenses attributable to the performing arts of more than 10% of gross income from the performing arts, and
Had AGI of $16,000 or less before deducting expenses as a performing artist.

Fee-basis state or local government offi- cial. You are a qualifying fee-basis official if you are employed by a state or political subdivision of a state and are compensated, in whole or in part, on a fee basis.

Employee with impairment-related work expenses. Impairment-related work expenses are the allowable expenses of an individual with physical or mental disabilities for attendant care at their place of employment. They also include other expenses in connection with the place of employment that enable the employee to work. See Pub. 463, Travel, Gift, and Car Expenses, for more details.

Allowable unreimbursed employee expen- ses. If you qualify as an employee in one of the categories mentioned above, you may be able to deduct the following items as unreimbursed employee expenses.

Unreimbursed employee expenses for individuals in these categories of employment are deducted as adjustments to gross income. Qualified employees listed in one of the categories above must complete Form 2106, Employee Business Expenses, to take the deduction.

You can deduct only unreimbursed employee expenses that are paid or incurred during your tax year, for carrying on your trade or business of being an employee, and ordinary and necessary.

An expense is ordinary if it’s common and accepted in your trade, business, or profession. An expense is necessary if it’s appropriate and helpful to your business. An expense doesn’t have to be required to be considered necessary.

Educator Expenses

If you were an eligible educator in 2025, you can deduct up to $300 of qualified expenses you paid in 2025 as an adjustment to gross income on Schedule 1 (Form 1040), line 11, rather than as a miscellaneous itemized deduction. If you and your spouse are filing jointly and both of you were eligible educators, the maximum deduction is $600. However, neither spouse can deduct more than $300 of their qualified expenses. For additional information, see Educator Expenses in Pub. 529, Miscellaneous Deductions.

Educator expenses include amounts

TIP paid or incurred in 2025 for personal

protective equipment, disinfectant, and other supplies used for the prevention of the spread of coronavirus. For more information, see the instructions for Schedule 1 (Form 1040), line 11, and Educator Expenses in Pub. 529, Miscellaneous Deductions.

Useful Items You may want to see:

Publication

463

525

529

463 Travel, Gift, and Car Expenses

525 Taxable and Nontaxable Income

529 Miscellaneous Deductions

Publication 17 (2025) Chapter 12 Other Itemized Deductions 101

Expenses You Can’t Deduct

Because of the suspension of miscellaneous itemized deductions, there are two categories of expenses you can’t deduct: miscellaneous itemized deductions subject to the 2%-of-AGI limitation, and those expenses that are traditionally nondeductible under the Internal Revenue Code. Both categories of deduction are discussed next.

Miscellaneous Deductions Subject to 2% AGI

Unless you fall into one of the qualified categories of employment under Unreimbursed Em- ployee Expenses, earlier, miscellaneous item- ized deductions that are subject to the 2%-of-AGI limitation can no longer be claimed. For expenses not related to unreimbursed employee expenses, you generally can’t deduct the following expenses, even if you fall into one of the qualified categories of employment listed earlier.

Appraisal Fees

Appraisal fees you pay to figure a casualty loss or the fair market value of donated property are miscellaneous itemized deductions and can no longer be deducted.

Casualty and Theft Losses

Damaged or stolen property used in performing services as an employee is a miscellaneous deduction and can no longer be deducted. For other casualty and theft losses, see Pub. 547, Casualties, Disasters, and Thefts.

Clerical Help and Office Rent

Office expenses, such as rent and clerical help, you pay in connection with your investments and collecting taxable income on those investments are miscellaneous itemized deductions and are no longer deductible.

Credit or Debit Card Convenience Fees

The convenience fee charged by the card processor for paying your income tax (including estimated tax payments) by credit or debit card is a miscellaneous itemized deduction and is no longer deductible.

Depreciation on Home Computer

If you use your home computer to produce income (for example, to manage your investments that produce taxable income), the depreciation of the computer for that part of the usage of the computer is a miscellaneous itemized deduction and is no longer deductible.

Fees To Collect Interest and Dividends

Fees you pay to a broker, bank, trustee, or similar agent to collect your taxable bond interest or dividends on shares of stock are miscellaneous itemized deductions and can no longer be deducted.

Hobby Expenses

A hobby isn’t a business because it isn’t carried on to make a profit. Hobby expenses are miscellaneous itemized deductions and can no longer be deducted.

Indirect Deductions of Pass-Through Entities

Pass-through entities include partnerships, S corporations, and mutual funds that aren’t publicly offered. Deductions of pass-through entities are passed through to the partners or shareholders. The partner’s or shareholder’s share of passed-through deductions for investment expenses are miscellaneous itemized deductions and can no longer be deducted.

Nonpublicly offered mutual funds. These funds will send you a Form 1099-DIV, Dividends and Distributions, or a substitute form, showing your share of gross income and investment expenses. The investment expenses reported on Form 1099-DIV are a miscellaneous itemized deduction and are no longer deductible.

Investment Fees and Expenses

Investment fees, custodial fees, trust administration fees, and other expenses you paid for managing your investments that produce taxable income are miscellaneous itemized deductions and are no longer deductible.

Legal Expenses

You can usually deduct legal expenses that you incur in attempting to produce or collect taxable income or that you pay in connection with the determination, collection, or refund of any tax.

Legal expenses that you incur in attempting to produce or collect taxable income, or that you pay in connection with the determination, collection, or refund of any tax are miscellaneous itemized deductions and are no longer deductible.

You can deduct expenses of resolving tax issues relating to profit or loss from business reported on Schedule C (Form 1040), Profit or Loss From Business, from rentals or royalties reported on Schedule E (Form 1040), Supplemental Income and Loss, or from farm income and expenses reported on Schedule F (Form 1040), Profit or Loss From Farming. Expenses for resolving nonbusiness tax issues are miscellaneous itemized deductions and are no longer deductible.

Loss on Deposits

For information on whether, and if so, how, you may deduct a loss on your deposit in a qualified financial institution, see Loss on Deposits in Pub. 547.

Repayments of Income

Generally, repayments of amounts that you included in income in an earlier year is a miscellaneous itemized deduction and can no longer be deducted. If you had to repay more than $3,000 that you included in your income in an earlier year, you may be able to deduct the amount. See Repayments Under Claim of Right, later.

Repayments of Social Security Benefits

For information on how to deduct your repayments of certain social security benefits, see Repayments More Than Gross Benefits in chapter 7.

Safe Deposit Box Rent

Rent you pay for a safe deposit box you use to store taxable income-producing stocks, bonds, or investment-related papers is a miscellaneous itemized deduction and can no longer be deducted. You also can’t deduct the rent if you use the box for jewelry, other personal items, or tax-exempt securities.

Service Charges on Dividend Reinvestment Plans

Service charges you pay as a subscriber in a dividend reinvestment plan are a miscellaneous itemized deduction and can no longer be deducted. These service charges include payments for:

Holding shares acquired through a plan,
Collecting and reinvesting cash dividends, and
Keeping individual records and providing detailed statements of accounts.

Tax Preparation Fees

Tax preparation fees on the return for the year in which you pay them are a miscellaneous itemized deduction and can no longer be deducted. These fees include the cost of tax preparation software programs and tax publications. They also include any fee you paid for electronic filing of your return.

Trustee’s Administrative Fees for IRA

Trustee’s administrative fees that are billed separately and paid by you in connection with your IRA are a miscellaneous itemized deduction and can no longer be deducted. For more information about IRAs, see chapter 9.

Nondeductible Expenses

In addition to the miscellaneous itemized deductions discussed earlier, you can’t deduct the following expenses.

List of Nondeductible Expenses

Adoption expenses.
Broker’s commissions.
Burial or funeral expenses, including the cost of a cemetery lot.
Campaign expenses.
Capital expenses.
Check-writing fees.
Club dues.

102 Chapter 12 Other Itemized Deductions Publication 17 (2025)

Commuting expenses.
Fees and licenses, such as car licenses, marriage licenses, and dog tags.
Fines or penalties.
Health spa expenses.
Hobby losses, but see Hobby Expenses , earlier.
Home repairs, insurance, and rent.
Home security system.
Illegal bribes and kickbacks.
Investment-related seminars.
Life insurance premiums paid by the insured.
Lobbying expenses.
Losses from the sale of your home, furniture, personal car, etc.
Lost or misplaced cash or property.
Lunches with co-workers.
Meals while working late.
Medical expenses as business expenses other than medical examinations required by your employer.
Personal disability insurance premiums.
Personal legal expenses.
Personal, living, or family expenses.
Political contributions.
Professional accreditation fees.
Professional reputation improvement expense.
Relief fund contributions.
Residential telephone line.
Stockholders’ meeting attendance expenses.
Tax-exempt income earning/collecting expenses.
The value of wages never received or lost vacation time.
Travel expenses for another individual.
Voluntary unemployment benefit fund contributions.
Wristwatches.

Adoption Expenses

You can’t deduct the expenses of adopting a child, but you may be able to take a credit for those expenses. See the Instructions for Form 8839, Qualified Adoption Expenses, for more information.

Campaign Expenses

You can’t deduct campaign expenses of a candidate for any office, even if the candidate is running for reelection to the office. These include qualification and registration fees for primary elections.

Legal fees. You can’t deduct legal fees paid to defend charges that arise from participation in a political campaign.

Check-Writing Fees on Personal Account

If you have a personal checking account, you can’t deduct fees charged by the bank for the privilege of writing checks, even if the account pays interest.

Club Dues

Generally, you can’t deduct the cost of membership in any club organized for business, pleasure, recreation, or other social purpose. This includes business, social, athletic, luncheon, sporting, airline, hotel, golf, and country clubs.

You can’t deduct dues paid to an organization if one of its main purposes is to:

Conduct entertainment activities for members or their guests, or
Provide members or their guests with access to entertainment facilities.

Dues paid to airline, hotel, and luncheon clubs aren’t deductible.

Commuting Expenses

You can’t deduct commuting expenses (the cost of transportation between your home and your main or regular place of work). If you haul tools, instruments, or other items in your car to and from work, you can deduct only the additional cost of hauling the items such as the rent on a trailer to carry the items.

Fines and Penalties

Generally, no deduction is allowed for fines and penalties paid to a government or specified nongovernmental entity for the violation of any law except in the following situations.

Amounts that constitute restitution.
Amounts paid to come into compliance with the law.
Amounts paid or incurred as the result of certain court orders in which no government or specified nongovernmental agency is a party.
Amounts paid or incurred for taxes due.

Nondeductible amounts include an amount paid in settlement of your actual or potential liability for a fine or penalty (civil or criminal). Fines or penalties include amounts paid such as parking tickets, tax penalties, and penalties deducted from teachers’ paychecks after an illegal strike.

No deduction is allowed for the restitution amount or amount paid to come into compliance with the law unless the amounts are specifically identified in the settlement agreement or court order. Also, any amount paid or incurred as reimbursement to the government for the costs of any investigation or litigation are not eligible for the exceptions and are nondeductible.

Health Spa Expenses

You can’t deduct health spa expenses, even if there is a job requirement to stay in excellent physical condition, such as might be required of a law enforcement officer.

Home Security System

You can’t deduct the cost of a home security system as a miscellaneous deduction. However, you may be able to claim a deduction for a home security system as a business expense if you have a home office. See Security system under Figuring the Deduction in Pub. 587.

Investment-Related Seminars

You can’t deduct any expenses for attending a convention, seminar, or similar meeting for investment purposes.

Life Insurance Premiums

You can’t deduct premiums you pay on your life insurance. You may be able to deduct, as alimony, premiums you pay on life insurance policies assigned to your former spouse. See Pub. 504, Divorced or Separated Individuals, for information on alimony.

Lobbying Expenses

You generally can’t deduct amounts paid or incurred for lobbying expenses. These include expenses to:

Influence legislation;
Participate or intervene in any political campaign for, or against, any candidate for public office;
Attempt to influence the general public, or segments of the public, about elections, legislative matters, or referendums; or
Communicate directly with covered executive branch officials in any attempt to influence the official actions or positions of those officials.

Lobbying expenses also include any amounts paid or incurred for research, preparation, planning, or coordination of any of these activities.

Dues used for lobbying. If a tax-exempt organization notifies you that part of the dues or other amounts you pay to the organization are used to pay nondeductible lobbying expenses, you can’t deduct that part. See Lobbying Ex- penses in Pub. 529 for information on exceptions.

Lost or Mislaid Cash or Property

You can’t deduct a loss based on the mere disappearance of money or property. However, an accidental loss or disappearance of property can qualify as a casualty if it results from an identifiable event that is sudden, unexpected, or unusual. See Pub. 547 for more information.

Lunches With Co-Workers

You can’t deduct the expenses of lunches with co-workers, except while traveling away from home on business. See Pub. 463 for information on deductible expenses while traveling away from home.

Meals While Working Late

You can’t deduct the cost of meals while working late. However, you may be able to claim a deduction if the cost of meals is a deductible entertainment expense, or if you’re traveling

Publication 17 (2025) Chapter 12 Other Itemized Deductions 103

away from home. See Pub. 463 for information on deductible entertainment expenses and expenses while traveling away from home.

Personal Legal Expenses

You can’t deduct personal legal expenses such as those for the following.

Custody of children.
Breach of promise to marry suit.
Civil or criminal charges resulting from a personal relationship.
Damages for personal injury, except for certain unlawful discrimination and whistle-blower claims.
Preparation of a title (or defense or perfection of a title).
Preparation of a will.
Property claims or property settlement in a divorce.

You can’t deduct these expenses even if a result of the legal proceeding is the loss of income-producing property.

Political Contributions

You can’t deduct contributions made to a political candidate, a campaign committee, or a newsletter fund. Advertisements in convention bulletins and admissions to dinners or programs that benefit a political party or political candidate aren’t deductible.

Professional Accreditation Fees

You can’t deduct professional accreditation fees such as the following.

Accounting certificate fees paid for the initial right to practice accounting.
Bar exam fees and incidental expenses in securing initial admission to the bar.
Medical and dental license fees paid to get initial licensing.

Professional Reputation

You can’t deduct expenses of radio and TV appearances to increase your personal prestige or establish your professional reputation.

Relief Fund Contributions

You can’t deduct contributions paid to a private plan that pays benefits to any covered employee who can’t work because of any injury or illness not related to the job.

Residential Telephone Service

You can’t deduct any charge (including taxes) for basic local telephone service for the first telephone line to your residence, even if it’s used in a trade or business.

Stockholders’ Meetings

You can’t deduct transportation and other expenses you pay to attend stockholders’ meetings of companies in which you own stock but have no other interest. You can’t deduct these expenses even if you’re attending the meeting

to get information that would be useful in making further investments.

Tax-Exempt Income Expenses

You can’t deduct expenses to produce tax-exempt income. You can’t deduct interest on a debt incurred or continued to buy or carry tax-exempt securities.

If you have expenses to produce both taxable and tax-exempt income, but you can’t identify the expenses that produce each type of income, you must divide the expenses based on the amount of each type of income to determine the amount that you can deduct.

Travel Expenses for Another Individual

You generally can’t deduct travel expenses you pay or incur for a spouse, dependent, or other individual who accompanies you (or your employee) on business or personal travel unless the spouse, dependent, or other individual is an employee of the taxpayer, the travel is for a bona fide business purpose, and such expenses would otherwise be deductible by the spouse, dependent, or other individual. See Pub. 463 for more information on deductible travel expenses.

Voluntary Unemployment Benefit Fund Contributions

You can’t deduct voluntary unemployment benefit fund contributions you make to a union fund or a private fund. However, you can deduct contributions as taxes if state law requires you to make them to a state unemployment fund that covers you for the loss of wages from unemployment caused by business conditions.

Wristwatches

You can’t deduct the cost of a wristwatch, even if there is a job requirement that you know the correct time to properly perform your duties.

Expenses You Can Deduct

You can deduct the items listed below as itemized deductions. Report these items on Schedule A (Form 1040), line 16, or Schedule A (Form 1040-NR), line 7.

List of Deductions

Each of the following items is discussed in detail after the list (except where indicated).

Amortizable premium on taxable bonds.
Casualty and theft losses from incomeproducing property.
Excess deductions of an estate or trust.
Federal estate tax on income in respect of a decedent.
Gambling losses up to the amount of gambling winnings.
Impairment-related work expenses of persons with disabilities.
Losses from Ponzi-type investment schemes (see Pub. 547 for more information).
Repayments of more than $3,000 under a claim of right.
Unlawful discrimination claims.
Unrecovered investment in an annuity.

Amortizable Premium on Taxable Bonds

In general, if the amount you pay for a bond is greater than its stated principal amount, the excess is bond premium. You can elect to amortize the premium on taxable bonds. The amortization of the premium is generally an offset to interest income on the bond rather than a separate deduction item.

Part of the premium on some bonds may be an itemized deduction on Schedule A (Form 1040). For more information, see Amortizable Premium on Taxable Bonds in Pub. 529 and Bond Premium Amortization in chapter 3 of Pub. 550, Investment Income and Expenses.

Casualty and Theft Losses of Income-Producing Property

You can deduct a casualty or theft loss as an itemized deduction on Schedule A (Form 1040), line 16, if the damaged or stolen property was income-producing property (property held for investment, such as stocks, notes, bonds, gold, silver, vacant lots, and works of art). First, report the loss in Form 4684, Section B. You may also have to include the loss on Form 4797 if you’re otherwise required to file that form. To figure your deduction, add all casualty or theft losses from this type of property included on Form 4684, lines 32 and 38b, or Form 4797, line 18a. For more information on casualty and theft losses, see Pub. 547.

Excess Deductions of an Estate or Trust

Generally, if an estate or trust has an excess deduction resulting from total deductions being greater than its gross income, in the estate’s or trust’s last tax year, a beneficiary can deduct the excess deductions, depending on its character. The excess deductions retain their character as an adjustment to arrive at adjusted gross income on Schedule 1 (Form 1040), as a non-miscellaneous itemized deduction reported on Schedule A (Form 1040), or as a miscellaneous itemized deduction. For more information on excess deductions of an estate or trust, see the Instructions for Schedule K-1 (Form 1041) for a Beneficiary Filing Form 1040.

Federal Estate Tax on Income in Respect of a Decedent

You can deduct the federal estate tax attributable to income in respect of a decedent that you as a beneficiary include in your gross income. Income in respect of the decedent is gross income that the decedent would have received had death not occurred and that wasn’t properly includible in the decedent’s final income tax return. See Pub. 559, Survivors, Executors, and Administrators, for more information.

104 Chapter 12 Other Itemized Deductions Publication 17 (2025)

Gambling Losses up to the Amount of Gambling Winnings

You must report the full amount of your gambling winnings for the year on Schedule 1 (Form 1040), line 8b. You deduct your gambling losses for the year on Schedule A (Form 1040), line 16. You can’t deduct gambling losses that are more than your winnings.

You can’t reduce your gambling win-

! nings by your gambling losses and re- CAUTION port the difference. You must report the

full amount of your winnings as income and claim your losses (up to the amount of win- nings) as an itemized deduction. Therefore, your records should show your winnings sepa- rately from your losses.

tax. See Repayments in chapter 8 for more information.

Unlawful Discrimination Claims

You may be able to deduct, as an adjustment to income on Schedule 1 (Form 1040), line 24h, attorney fees and court costs for actions settled or decided after October 22, 2004, involving a claim of unlawful discrimination, a claim against the U.S. Government, or a claim made under section 1862(b)(3)(A) of the Social Security Act. However, the amount you can deduct on Schedule 1 (Form 1040), line 24h, is limited to the amount of the judgment or settlement you are including in income for the tax year. See Pub. 525, Taxable and Nontaxable Income, for more information.

Unrecovered Investment in Annuity

A retiree who contributed to the cost of an annuity can exclude from income a part of each payment received as a tax-free return of the retiree’s investment. If the retiree dies before the entire investment is recovered tax free, any unrecovered investment can be deducted on the retiree’s final income tax return. See Pub. 575, Pension and Annuity Income, for more information about the tax treatment of pensions and annuities.

See Pub. 529 for more information.

Impairment-Related Work Expenses

If you have a physical or mental disability that limits your being employed, or substantially limits one or more of your major life activities, such as performing manual tasks, walking, speaking, breathing, learning, and working, you can deduct your impairment-related work expenses.

Impairment-related work expenses are ordinary and necessary business expenses for attendant care services at your place of work and for other expenses in connection with your place of work that are necessary for you to be able to work.

Self-employed. If you’re self-employed, enter your impairment-related work expenses on the appropriate form (Schedule C (Form 1040), Schedule E (Form 1040), or Schedule F (Form 1040)) used to report your business income and expenses.

Repayments Under Claim of Right

If you had to repay more than $3,000 that you included in your income in an earlier year because at the time you thought you had an unrestricted right to it, you may be able to deduct the amount you repaid or take a credit against your

Diary of winnings and losses. You must keep an accurate diary or similar record of your losses and winnings.

Your diary should contain at least the following information.

The date and type of your specific wager or wagering activity.
The name and address or location of the gambling establishment.
The names of other persons present with you at the gambling establishment.
The amount(s) you won or lost.

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