IRS Issues Final Regs on the Deduction for Qualified Transportation Fringe and Commuting Expenses

 – December 11, 2020
IRS Issues Final Regs on the Deduction for Qualified Transportation Fringe and Commuting Expenses

The Treasury Department and IRS issued final regulations on the deduction for qualified transportation fringe and commuting expenses following changes made by the Tax Cuts and Jobs Act (TCJA).

The 2017 TCJA generally disallows deductions for qualified transportation fringe (QTF) expenses and does not allow deductions for certain expenses of transportation and commuting between an employee's residence and place of employment.

These final regulations address the disallowance of the deduction for expenses related to QTFs provided to an employee of the taxpayer, including providing guidance and methodologies to determine the amount of QTF parking expenses that is nondeductible. The final regulations also address the disallowance of the deduction for expenses of transportation and commuting between an employee's residence and place of employment.