Summertime is the season that often leads to major life decisions, such as buying a home, moving or a job change. If you are looking for a new job that is in the same line of work, you may be able to deduct some of your job-hunting expenses on your federal income tax return.
To qualify for a deduction, your 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. The following are examples of deductible expenses:
You cannot deduct your job search expenses if there was a substantial break between the end of your last job and the time you began looking for a new one or if you are looking for a job for the first time.
To deduct job search expenses, you must itemize your deductions. If you use the standard deduction, you get no benefits from job search expenses. The deduction is also part of your miscellaneous itemized deductions, which are allowed only to the extent they exceed 2% of your adjusted gross income. So, depending upon whether you have other miscellaneous deductions, the job search expenses may be further limited. Miscellaneous itemized deductions are not allowed at all if you are taxed by the alternative minimum tax (AMT), so to the extent you are taxed by the AMT you receive no benefit from job-seeking expenses.
If you have questions related to job-seeking expenses or how they fit into your taxes, please give this office a call.
Donna Bordeaux, CPA with Calculated Moves
Creativity and CPAs don’t generally go together. Most people think of CPAs as nerdy accountants who can’t talk with people. Well, it’s time to break that stereotype. Lively, friendly, and knowledgeable can be a part of your relationship with your CPA as demonstrated by Donna and Chad Bordeaux. They have over 50 years of combined experience as entrepreneurial CPAs. They’ve owned businesses and helped business owners exceed their wildest dreams. They have been able to help businesses earn many times more profit than the average business in the same industry and are passionate about helping industries that help families build great memories.