Tax Deductions for Your Job Search

Sometimes just the mere fact that you are looking for a job can mean you have to spend money in order to do so. This can add financial strain to you when you are already feeling an economic pinch. Thankfully, Uncle Sam does allow you to get a little bit of relief come tax time for some of those expenses.

Not so fast though, what you can and can't deduct in regards to your job search when tax time rolls around does depend on a few variables such as:

Time

You only have so long to start looking for a job after losing your previous employment so you can't sit around and wait too long. In this case, the early bird definitely gets the worm.

Same Field

You will only be able to claim qualifying deductions for your job search if you are hunting for a new job in the same field as your previous job. So, you can't be looking for a job as a florist if you were previously employed as a high school teacher. If you do, your luck will run out come tax time.

Rookie Exemption

If you are seeking your very first job Uncle Sam would be proud. However, he won't give you any breaks as any deductions that you might otherwise qualify for are null and void since you are seeking employment for the very first time.

Must Itemize Deductions

With moving being the only exception, all of your job hunting tax deductions must go under 'miscellaneous' deductions. In order to do this, you must itemize when you file.

For those who meet the criteria for deducting job search related expenses, it helps to know what you can deduct. More often than not, items such as resume related fees, phone interviews were you paid long distance fees, some travel fees, job agency fees, and moving fees will all be deductable items. Of course, you should be sure to seek the advice of a professional accountant or CPA as they will be able to tell you for sure what you can and can't deduct and might even be able to show you some deductions you may have overlooked.

Being on the hunt for a new job is often a challenging endeavor. While the effort may be one that seems too great to overcome at times, at least Uncle Sam allows you some type of relief come tax time. While it may not be a new job, it is better than nothing at all.

Source: Alison Doyle, Job Search Tax Deduction Tips, About.com