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Ordering forms and publications. Visit IRS.gov/FormsPubs to download forms and publications. Otherwise, you can go to IRS.gov/ OrderForms to order current and prior-year forms and instructions. Your order should arrive within 10 business days. Tax questions. If you have a tax question not answered by this publication, check IRS.gov and How To Get Tax Help at the end of this publication. Future Developments For the latest information about developments related to Pub. 535, such as legislation enacted after it was published, go to IRS.gov/Pub535. What's New for 2018 The following items highlight some changes in the tax law for 2018. Form 1040 redesigned. Form 1040 has been redesigned for 2018. See Form 1040 and its in- structions for more information. Forms 1040A and 1040EZ no longer availa- ble. Forms 1040A and 1040EZ aren't available to file your 2018 taxes. If you used one of these forms in the past, you will now file Form 1040. Credit expiration. At the time this publication was printed, certain credits expired at the end of 2017. To find out if legislation was enacted to extend these credits and make them available for 2018, go to IRS.gov/FormsUpdates. Small business taxpayers. For tax years be- ginning after 2017, more small business taxpay- ers may qualify to use the cash method of ac- counting and be exempt from capitalizing certain expenses under section 263A. In addi- tion, small business taxpayers may not be re- quired to account for inventories under section 471 and are not subject to the business interest expenses limitation. See the discussion in chapter 1. Compensation in excess of $1 million. P.L. 115-97, Tax Cuts and Jobs Act, made signifi- cant changes to section 162(m) which disallows the deduction of excessive employee compen- sation by any publicly held corporation. For more information, see chapter 2. Employee achievement awards. P.L. 115-97 defines items that aren't tangible personal prop- erty for purposes of employee achievement awards. Tangible personal property doesn't in- clude cash, gift cards, and other nontangible personal property. For more information, see chapter 2. Certain expense deductions are now limi- ted. Certain expense deductions are now limi- ted. P.L. 115-97 limits the deduction by employ- ers of expenses for certain fringe benefits and entertainment expenses. For more information, see chapter 2. Uniform capitalization rules. P.L. 115-97, Tax Cuts and Jobs Act, made changes to uni- form capitalization rules for small business tax- payers. For more information, see chapter 3. Alternative minimum tax (AMT). For tax years beginning after 2017, the Tax Cuts and Jobs Act, section 12001, repealed the corpo- rate AMT. For more information, see chapter 7. Standard mileage rate. Beginning in 2018, the standard mileage rate for the cost of operat- ing your car, van, pickup, or panel truck for each mile of business use is 54.5 cents per mile. For more information, see chapter 11. No miscellaneous itemized deductions al- lowed. You can no longer claim any miscella- neous itemized deductions, including the de- duction for repayments (claim of right). Miscellaneous itemized deductions are those deductions that would have been subject to the 2%-of-adjusted-gross-income limitation. For more information, see chapter 11. Certain payments made in sexual harass- ment or sexual abuse cases. For amounts paid or incurred after December 22, 2017, new section 162(q) provides that no deduction is al- lowed under section 162 for any settlement or payment related to sexual harassment or sexual abuse if it is subject to a nondisclosure agree- ment. In addition, attorney’s fees related to such a settlement or payment are not allowed as a deduction. For more information, see chap- ter 11. Qualified Business Income Deduction. We added a new chapter 12 discussing qualified business income deduction under section 199A. For tax years beginning after 2017, indi- vidual taxpayers and some trusts and estates may be entitled to a deduction of up to 20% of their Qualified Business Income (QBI) from a trade or business, including income from a pass-through entity, but not from a C corpora- tion, plus 20% of qualified real estate invest- ment trust (REIT) dividends and qualified pub- licly traded partnership (PTP) income. The deduction is subject to multiple limitations, such as the type of trade or business, the taxpayer’s taxable income, the amount of W-2 wages paid in the trade or business, and the unadjusted ba- sis immediately after acquisition (UBIA) of quali- fied property held by the trade or business. The deduction can be taken in addition to the stand- ard or itemized deductions. For more informa- tion, see chapter 12. What's New for 2019 The following item highlights a change in the tax law for 2019. Standard mileage rate. Beginning in 2019, the standard mileage rate for the cost of operat- ing your car, van, pickup, or panel truck for each mile of business use is 58 cents per mile. Reminders The following reminders and other items may help you file your tax return. IRS e-file (Electronic Filing) You can file your tax returns electronically using an IRS e-file option. The benefits of IRS e-file include faster refunds, increased accuracy, and acknowledgment of IRS receipt of your return. You can use one of the following IRS e-file options. • Use an authorized IRS e-file provider. • Use a personal computer. • Visit a Volunteer Income Tax Assistance (VITA) or Tax Counseling for the Elderly (TCE) site. For details on these fast filing methods, see your income tax package. Form 1099-MISC. File Form 1099-MISC, Mis- cellaneous Income, for each person to whom you have paid during the year in the course of your trade or business at least $600 in rents, services (including parts and materials), prizes and awards, other income payments, medical and health care payments, and crop insurance proceeds. See the Instructions for Form 1099-MISC for more information and additional reporting requirements. Photographs of missing children. The Inter- nal Revenue Service is a proud partner with the National Center for Missing & Exploited Children® (NCMEC). Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 800-THE-LOST (800-843-5678) (24 hours a day, 7 days a week) if you recognize a child. Preventing slavery and human trafficking. Human trafficking is a form of modern-day slav- ery, and involves the use of force, fraud, or co- ercion to exploit human beings for some type of labor or commercial sex purpose. The United States is a source, transit, and destination country for men, women, and children, both U.S. citizens and foreign nationals, who are subjected to the injustices of slavery and hu- man trafficking, including forced labor, debt bondage, involuntary servitude, “mail-order” marriages, and sex trafficking. Trafficking in persons can occur in both lawful and illicit in- dustries or markets, including in hotel services, hospitality, agriculture, manufacturing, janitorial services, construction, health and elder care, domestic service, brothels, massage parlors, and street prostitution, among others. The President’s Interagency Task Force to Monitor and Combat Trafficking in Persons (PITF) brings together federal departments and agencies to ensure a whole-of-government ap- proach that addresses all aspects of human trafficking. Online resources for recognizing and reporting trafficking activities, and assisting vic- tims include the Department of Homeland Se- curity (DHS) Blue Campaign at DHS.gov/blue- campaign, the Department of State Office to Monitor and Combat Trafficking in Persons at State.gov/j/tip, and the National Human Traf- ficking Resource Center (NHTRC) at humantraffickinghotline.org. DHS is responsible for investigating human trafficking, arresting traffickers, and protecting victims. DHS also provides immigration relief to non-U.S. citizen victims of human trafficking. DHS uses a victim- centered approach to combating human traf- ficking, which places equal value on identifying and stabilizing victims and on investigating and Page 2 Publication 535 (2018)