The One Big Beautiful Bill Act (OBBA), signed into law on July 4, 2025, permanently eliminates miscellaneous itemized deductions from the federal tax code. These deductions, once available to taxpayers who itemized on Schedule A, are no longer allowed under any circumstances starting with the 2025 tax year.
What Was Previously Included
Before 2018, taxpayers could deduct certain expenses that exceeded 2% of their adjusted gross income (AGI). These miscellaneous itemized deductions included:
- Unreimbursed employee expenses
- Tax preparation fees
- Investment advisory fees
- Safe deposit box fees
- Job search expenses
- Certain legal fees
For more detail, visit: Publication 529 (12/2020), Miscellaneous Deductions | Internal Revenue Service
Temporary Suspension Under the TCJA
The Tax Cuts and Jobs Act (TCJA) of 2017 suspended all miscellaneous itemized deductions for tax years 2018 through 2025. This was intended as a temporary simplification of the tax code, with the deductions scheduled to return in 2026 unless Congress acted to extend or modify the law.
Permanent Repeal Under OBBA
The OBBA ends that uncertainty. It permanently repeals the entire category of miscellaneous itemized deductions, including the unreimbursed employee expenses for eligible educators, which had been under consideration for reinstatement. This means that even after the TCJA provisions expire, these deductions will not return.
