The fine folks at Westwood Tax and Consulting have provided some helpful advice on what is deductible during your job search and who may qualify:
Deductibility of Job Search Expenses:
If you’ve been laid off from your job and incur various expenses trying to secure a new one, Uncle Sam may provide you an opportunity for a tax deduction.
The IRS provides a deduction for job search expenses as long as the new job is in the same field of work that you were previously in. A computer programmer will not qualify for the deduction if he decides to look for a job in education.
Unfortunately, if you took what the IRS considers a “substantial break” between your last job and when you begin looking for another one, then you will not qualify for the deduction. For example, if you were laid off in January and decided to devote your newfound free time to catching up on 24 and House, you cannot deduct any job search expenses if you resume the hunt the following January. On the positive side, you would have been privy to watching two of the best shows on television.
And lastly, for the college graduates out there, this deduction is not for you. The IRS only allows a deduction after you have already had a position. You may have that fancy degree from an Ivy League School, but no job search tax deduction for you.
Even if you passed the three tests outlined above, this deduction only applies if you itemize your deductions AND your job search expenses, along with other miscellaneous deductions, exceed 2% of your adjusted gross income.
So now that you know whether you qualify or not, listed below are some examples of valid job search deductions:
-Employment and Job Search Agency Fees
- Travel expenses
-Printing and mailing of letters and resumes
Should you have any questions about this deduction or anything else tax related please feel free to contact us at (516) 792-0505 or email@example.com.