Posted by : Daniel Stoica in (Articles, Income Taxes, Tax Tips) On: August 2nd, 2011
Tagged Under : accounting professional, Daniel Stoica, deductions, expenses, gas, Gross Income, IRS, job seekers, mileage, Publication 529, resumes, Schedule A, Tax, tax professional, tips
Many taxpayers are busy updating their resumes and going to job fairs during the summer. The IRS wants everyone to be aware that most people can tax deductions on their tax returns for some of their job hunting expenses.
Here are 7 tips from the IRS regarding taking deductions for job search expenses.
1. All of the expenses must be related to your job search for your current career. You can’t take a deduction for job search expenses for a new career.
2. You are allowed to deduct expenses for employment agency fees while you are looking for work in your current career field. If those fees are paid back by an employer, you have to include that in your gross income.
3. You are allowed to take deductions for copies and mailing of your resume to employers if you are looking for a job in your current career field.
4. You may be allowed to deduct travel expenses to and from an interview that relates to your current occupation. Travel expenses include mileage and gas, but only if it’s related to your job search.
5. You may not take a deduction for job searches if there is a major gap in your employment. Check with the IRS website to find the specifics of this rule.
6. You may not take deductions if you are looking for your first job.
7. Your job search expenses are limited. You may only claim 2% of the adjusted gross income of your previous employer. You may figure your deductions on Schedule A when you file your tax return.
For more detailed information and instructions on deducting job search expenses, see Publication 529, Miscellaneous Deductions. You can find this publication on www.irs.gov or by calling 800-829-3676.