The IRS said that the limit on elective deferral contributions to 401(k) plans, 403(b) plans, most 457 plans, and the federal government’s Thrift Savings Plan will increase from $18,500 in 2018 to $19,000 in 2019. However, the catch-up contribution limit for those 50 and older remains $6,000 (Notice 2018-83). Most other inflation-adjusted amounts related to pensions increased from 2018 to 2019.

The IRS on Wednesday issued guidance clarifying that taxpayers may generally continue to deduct 50% of the food and beverage expenses associated with operating their trade or business, despite changes to the meal and entertainment expense deduction under Sec. 274 made by the tax law known as the Tax Cuts and Jobs Act (TCJA), P.L. 115-97 (Notice 2018-76). According to the IRS, the amendments specifically deny deductions for expenses for entertainment, amusement, or recreation, but do not address the deductibility of expenses for business meals. 

Under proposed regulations issued by the IRS on Thursday, transfers to a state agency or charitable organization in lieu of paying state and local taxes would be deductible as a charitable contribution only to the extent that the taxpayer making the donation did not receive a quid pro quo (REG-112176-18). Contributions that result in a state or local tax credit in return for the contribution would not be deductible for federal tax purposes to the extent of the credit; however, contributions that result in a state or local tax deduction may be deductible for federal tax purposes.

The Consolidated Appropriations Act, 2018, H.R. 1625, which is the $1.3 trillion spending bill that Congress passed on Friday, contains a few tax-related provisions, including funding for the IRS and technical corrections to various recent pieces of tax legislation. It also amends the centralized partnership audit regime and changes the Sec. 199A deduction for farmers who sell grain to agricultural cooperatives.

In Rev. Proc. 2018-18, the IRS announced the new lower tax brackets for 2018 and a number of other new items affected by P.L. 115-97, known as the Tax Cuts and Jobs Act. It also issued inflation-adjusted amounts for many provisions that were unchanged by the Act, other than that the inflation adjustments now must be calculated using the chained consumer price index method, updating the numbers that were originally announced in Rev. Proc. 2017-58.