5 Tax Breaks for Job Seekers
By: Juliana Weiss-Roessler
Looking for a job can be a draining experience - both emotionally and for your bank account. You have to update and print out copies of your resume. You need business cards. You have to drive to and from interviews, and sometimes even pay for parking. Not to mention, the costs you'll incur if you decide to take any classes to better your skill set and increase your chances of getting the job you want. Thankfully, the US government knows just how expensive this process can be and offers many tax breaks for people searching for a job in their current field:
Travel
If you're a banker in Seattle and you fly to Los Angeles to look for banking jobs there, you can deduct any expenses related to the job search from the trip. This would include things like the flight, hotel, networking meals and drives to interviews, but would not include that day trip to Universal Studios.
Employment Agency Fees
Any fees you pay to employment and outplacement agencies are deductible. However, if your employer pays you back for those fees - even in a later year - you must include the amount you receive in your gross income for that year up to the amount of your tax benefit in the earlier year.
Preparing, Printing, and Mailing
If you spend money to print and mail your resume to potential employers, every cent is deductible. You can also deduct the cost of having someone professionally prepare your resume and any business cards you purchase.
Calls
In this age of ubiquitous cell phones, this one probably doesn't mean as much as it used to, but local and long distance phone calls to prospective employers are also deductible.
Limitations to Deductions
Unfortunately, if you decided to take a long break after your last job ended before you began looking for a new one, job search expenses cannot be deducted. You also can't deduct any job search expenses if you've never had a job before, or if you've decided to change careers and look for a completely different kind of job. Check with your accountant to make sure you're eligible for these deductions.
For more information about job search deductions, see IRS Publication 529, Miscellaneous Deductions. Or get free job search help to minimize costs when finances are at their tightest.
Learn other ways to hang onto your money at Quizzle.com, where you'll get access to great money tools like the Debt Paydown Planner that will help you get out of debt faster so you can save potentially thousands in interest.
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