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Job Hunting Expenses – Can They Be Tax Deductible?

Did you know if you are looking for a new job, you may be able to deduct some job-hunting expenses on your federal income tax return?

Here are five facts to know about deducting costs related to job searches:

  1. Same Occupation. Expenses are tax deductible when the job search is in your same line of work.
  2. Types of Deductible Costs. Examples of job hunting related costs that qualify include: the cost of preparing and mailing a résumé, travel costs (transportation, lodging and meals) and job placement or employment agency fees.  Note that clothes for an interview are not a qualifying cost.
  3. Result of Job Search. Qualifying expenses are deductible even if the taxpayer is unsuccessful in obtaining employment or does not accept a new position if offered.
  4. Temporary Employment. Expenses incurred related to temporary employment during your job search, even in a different line of work, can still be deductible.
  5. Schedule A. Report job search expenses on Schedule A of a 1040 tax return and claim them as miscellaneous deductions. The total miscellaneous deductions that exceed two percent of the taxpayer’s adjusted gross income will be included in the itemized deductions for the year.

Taxpayers can’t deduct these expenses if they:

  • Are looking for a job in a new profession,
  • Had a significant break, generally greater than one year, between their last job ending and looking for a new one, or
  • Are searching for a job for the first time.

For any questions related to job-hunting expenses, always consult a Certified Public Accountant. Submitted By: Dennis Gallant, Senior Manager, Tax Services, Thomas Howell Ferguson P.A. CPAs, (850) 668-8100, dgallant@thf-cpa.com

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