Job Search Expenses Are Tax-Deductible

If you’re looking for a job, make sure you track your expenses and mileage. Job search expenses are tax-deductible on your Itemized Deductions Schedule A. Here are the IRS Rules for deducting job search expenses:

  1. To qualify for a deduction, the expenses must be spent on a job search in
    your current occupation. You may not deduct expenses you incur while looking for
    a job in a new occupation.
  2. You can deduct employment and outplacement agency fees you pay while looking
    for a job in your present occupation. If your employer pays you back in a later
    year for employment agency fees, you must include the amount you receive in your
    gross income, up to the amount of your tax benefit in the earlier year.
  3. You can deduct amounts you spend for preparing and mailing copies of your
    résumé to prospective employers as long as you are looking for a new job in your
    present occupation.
  4. If you travel to an area to look for a new job in your present occupation,
    you may be able to deduct travel expenses to and from the area. You can only
    deduct the travel expenses if the trip is primarily to look for a new job. The
    amount of time you spend on personal activity compared to the amount of time you
    spend looking for work is important in determining whether the trip is primarily
    personal or is primarily to look for a new job.
  5. You cannot deduct job search expenses if there was a substantial break
    between the end of your last job and the time you begin looking for a new one.
  6. You cannot deduct job search expenses if you are looking for a job for the
    first time.
  7. The amount of job search expenses that you can claim on your tax return is
    limited. You can claim the amount that is more than 2 percent of your adjusted
    gross income.  You figure your deduction on Schedule A.
Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s