Strategizing International Tax Best Practices – by Keith Brockman

Posts tagged ‘Sec 132’

TCJA parking non-deductibility; TEI offers valuable insight/safe harbors

IRS Notice 2018-99, published on Christmas Eve, has created quite a controversy in its short history for creating non value-added work in extricating costs of a company’s (leased or owned) parking facilities for which a federal tax deduction would not be allowable.  The Notice and TEI’s letter are attached for reference.

TEI’s timely letter expresses the history of this provision, and most importantly the inordinate amount of work, legal fees, etc. that would be involved pursuant to the Notice.

Two safe harbor provisions are suggested for implementation; Owned facilities $100 per parking spot per directly attributable expenses, and leased facilities would use 5% of the rent as the deemed amount subject to disallowance.

It is hopeful that IRS will quickly respond to current controversy and adopt such harbor provisions, or similar provisions, to avoid significant costs involved in preparing the 2018 federal income tax returns.  

https://www.irs.gov/pub/irs-drop/n-18-99.pdf

https://www.tei.org/sites/default/files/advocacy_pdfs/TEI%20Comments%20on%20Notice%202018-99_FINAL_2.22.19.pdf

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