Many Job-Search Expenses are Tax Deductible

When you're job searching, whether presently employed or not, it's important to keep track of your job-search expenses, because some of these costs may be tax deductible. Part of what defines tax-deductible job-search expenses is that you accrued them in pursuit of a position in your present occupation. Thus, if you are an accountant hoping to make it as an actor, you can't legally claim deductions for your travel to Hollywood. But for the masses of us looking for jobs in our present field, there are plenty of expenses that the IRS will allow us to deduct from our taxable income.

We've searched and found some common deductibles, but before you read the list, please take note. We're not tax experts. This is general advice. At the bottom of this article, you'll find a link to the IRS site, which provides much greater detail.

Meanwhile, the deductibles you may have racked up:

• Making local or long-distance phone calls
• Preparing, copying, and mailing your resume
• Obtaining career counseling
• Traveling in the pursuit of employment (filling out an application at 7-11 while on an Hawaiian vacation does not qualify); there's a ratio of time spent on personal activity versus time spent in looking for work that helps define whether travel expenses are deductible
• Non-reimbursed expenses to retain professional licensure or other accreditation in your present occupation
• Employment and outplacement agency fees that you paid for and were not reimbursed by a later employer (if a later employer reimburses you for these fees, you will have to claim that as income; if an employer pays these fees directly to the employment agency, and you are not responsible for them, you do not have to claim this as income)
• Dues to a professional society, union, or organization that is required or helps you do your job in your present occupation (these fees are not deductible if they are incurred for your entry into a new occupation)
• Union dues and expenses required to maintain employment in your present occupation
• And, if you are paying for your own health insurance, you may deduct that expense if it exceeds a certain proportion of your taxable income
• Expenses for work-related education that maintains or improves skills required in your present line of work (note, expenses incurred for entering a new line of work are not deductible)

Keep canceled checks, substitute checks, or account statements and receipts of the expenses paid to prove the deductions you claim.

For your information, the rate for business use of a vehicle for 2007 was 48½ cents per mile.

IRS Publication 463 explains in full detail what you'll need to know about deducting travel and transportation deductions. You can access the IRS website at www.irs.gov for more information about any of these matters or to arrange personal assistance.

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