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Tax Deductions and Your Job Search

Posted By Tara Finnegan Coates On January 24, 2013 @ 10:24 am In Industrial Revolution | Comments Disabled

[1]The following is a guest post by Alan Kalman. 

Previously, I discussed the tax consequences of losing your job [2]. But did you know that there are certain tax deductions you can take while looking for your next job (even if you don’t get hired)? These include:

  • Employment and outplacement agency fees.
  • Amounts spent for preparing and mailing resumes.
  • Mileage and parking expenses for interviews
  • Going back to college to take some courses to improve your skills. (In this case, you may be able to either take a deduction to gross income or obtain a tax credit. See IRS Pub 970 [3] for details.)
  • If you find a new job and have to relocate, you may be able to deduct some of your moving expenses. See IRS Pub 521 [4].

You must itemize deductions to claim these unreimbursed expenses. Job hunting expenses [5] are considered a miscellaneous itemized deduction [6] subject to the 2 percent of your adjusted gross income (AGI) limitation. See the instructions [7] for completing Line 21 of Form 1040 Schedule A.

[8] Alan Kalman is a volunteer for the AARP Foundation Tax-Aide Program [9] in Santa Fe, N.M. He is a retired financial executive from IBM Corporation and Siemens AG. Through the AARP Foundation Tax-Aide program, AARP Foundation [10] provides online tax counseling as a public service, and cannot guarantee the accuracy of the information provided. Your taxes are your responsibility. You are solely responsible for what you do in your own tax situation.


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URL to article: http://blog.aarp.org/2013/01/24/tax-deductions-and-your-job-search/

URLs in this post:

[1] Image: http://blog.aarp.org/wp-content/uploads/2013/01/5512347305_20dda91167.jpg

[2] tax consequences of losing your job: http://blog.aarp.org/2013/01/08/job-loss-and-your-taxes/

[3] IRS Pub 970: http://www.irs.gov/pub/irs-pdf/p970.pdf

[4] IRS Pub 521: http://www.irs.gov/pub/irs-pdf/p521.pdf

[5] Job hunting expenses: http://www.aarp.org/money/taxes/info-07-2010/tax-tips-for-job-seekers.html

[6] miscellaneous itemized deduction: http://www.irs.gov/pub/irs-pdf/p529.pdf

[7] instructions: http://www.irs.gov/pub/irs-pdf/i1040sca.pdf

[8] Image: http://blog.aarp.org/wp-content/uploads/2013/01/Kalman1.jpg

[9] AARP Foundation Tax-Aide Program: http://www.aarp.org/taxaide/

[10] AARP Foundation: http://www.aarp.org/aarp-foundation/

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