It’s FINALLY almost springtime and tax season is in full swing. We have some good news that job seekers might not be aware of – elements of your search might be tax deductible.
Job-hunting can be extremely daunting, not to mention, time consuming and the hours can easily add up to that of some full-time jobs. Often, you don’t even realize all the expenses that have gone towards trying to land a new job. If you aren’t currently working, this can add up quickly and be a huge hit to your limited resources. Luckily, some of these expenses are deductible. You should keep track of any and all expenses that you incur while you conduct your search.
There are, of course, certain rules that you will need to follow to make sure that you can make these deductions. The most important thing to remember is that you have to be looking for a job that is in your CURRENT industry so if you are a lawyer, but think that teaching is your real calling, you won’t get any reimbursement. Unfortunately, this means first time job seekers won’t be able to take advantage of these breaks either. Finally, you should beware of too large of a gap between jobs. If you intentionally left the workforce for travel or a break, the tax deductions won’t apply when you decide to look for a job again.
Here is a snapshot of what the IRS allows for job search related tax deductions:
Employment Agencies: If you pay an agency or use a website that charges a fee for job placement and searches, this is tax deductible.
Travel Expenses: ONLY if they are primarily job related. The IRS will closely monitor this; so don’t try to sneak in any personal trips.
Resume Services: If you use a company of person to help polish your resume, you can deduct this.
For the full breakdown you should go to the IRS website and consult Publication 529.