A closer look at the next 1040 schedules and other forms

The Internal Revenue Service has made drafts of the schedules for Form 1040 as well as some other forms for the 2017 tax year available on its Web site.

Jeffrey Pretsfelder, a senior analyst with Thomson Reuters Checkpoint, highlights some of the key changes. (A text version of these changes is also available, as is a slideshow of the changes to the 1040 itself.

For Line 1, “Medical and dental expenses,” the 2017 standard mileage rate for medically-related use of an auto is 17 cents per mile.

For Line 3, “Medical expense floor:” In prior years, the amount that had to be subtracted from eligible medical and dental expenses, if the taxpayer or their spouse was age 65 or older by the end of the year, differed from the amount that had to be subtracted if the taxpayer was under age 65 by the end of the year; it was 7.5 percent of adjusted gross income. For 2017, the amount that has to be subtracted is 10 percent of AGI, i.e., the same amount that has to be subtracted for taxpayers who are under 65 by the end of the year.

Line 13, “Reserved,” was, in prior years, entitled “Mortgage insurance premiums.” The deduction for these has been terminated with respect to amounts paid or accrued after Dec. 31, 2016.

Line 17, “Gifts to charity, other than by cash or check,” note that the standard mileage rate is 14 cents per mile for use of an auto in rendering gratuitous services to a charitable organization.

For Line 21, “Unreimbursed employee expenses,” the 2017 standard mileage rate for business travel is 53.5 cents per mile.

On Line 29, “Limit on itemized deductions,” note that itemized deductions for taxpayers with adjusted gross incomes in excess of the "applicable amount" ($313,800 for joint filers or a surviving spouse, $287,650 for a head of household, $261,500 for a single individual who isn't a surviving spouse, and $156,900 for marrieds filing separately) may be reduced.

There are no changes to the form itself.

On Line 1, “Interest,” note that accrued interest on Series EE U.S. savings bonds issued in 1987 is taxable.

On Line 3, “Excludable interest on Series EE or Series I U.S. savings bonds,” note that the exclusion for education-related savings bond interest phases out at higher income levels. For 2017, the phaseout begins at modified AGI above $78,150 ($117,250 on a joint return).