Job hunting is tax deductible
(MoneyWatch) Yesterday was the deadline to file taxes, so in honor of the federal tax filing deadline, you can file this info away for your tax preparation for 2013: Job searches are tax deductible, and carefully accounting for the expenses that pile up when changing jobs can save you money at tax time.
Job search writeoffs are one of the great overlooked tax deductions, and while not everyone qualifies, the IRS is generous in a number of ways. For example, you don't need to actually find a job in 2013 in order to claim the expenses on your 2013 tax return; just having looked qualifies you for the benefit.
So who does qualify? Well, to claim job hunting on Line 21 of Schedule A, your expenses must add up to no less than 2 percent of your total gross income, which can be the deal killer if the job you just left paid you a substantial salary. Moreover, you can't have taken a "substantial break" from employment before starting your search (the IRS doesn't define it, but it's likely that taking an extended sabbatical or time to raise a child will disqualify you) and you can't be changing careers, either -- it must be a new role in your established career field.
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Personal finance site Wisebread recently rolled up the key deductions you can claim to ease your tax burden:
Employment services. You can deduct fees associated with services like employment counseling, headhunters, and job placement services.
Resume preparation. Does your resume need the help of a pro? You can deduct fees charged by professionals to tweak your resume, as well as resume prep books and printing costs associated with creating and duplicating your resume.
Travel. Did you have to travel in support of your job search? Frequently, these costs are absorbed by the company that's interviewing you, but when it's not, you can deduct. Specifically, you can claim about 55 cents per mile that you need to drive for interviews and job search events (like networking and trade fairs). A host of other expenses are deductible, like parking fees, hotel rooms, other transportation, and 50 percent of meals.
Communication. You can claim the specific, itemized costs of calls made in support of your job search.
Professional development. If you attend job fairs, conferences, networking events, or career growth courses, you're in luck -- the fees are expensable. Even LinkedIn's premium fees are covered.
