Tax day is here and many people are scrambling to make the final deadline.
It is important to keep a record of job hunting expenses as they may qualify for a tax write off or credits.
Some job hunting expenses can be written off. However it will vary by your own situation (collecting severance, unemployment, household income) to determine what write-offs you are entitled to. Unfortunately the rules often change from year to year so it worth keep up with the law.
Talk to an accountant. If you are planning to use an accountant the earlier the discussions of the latest tax code revisions and allowable deductions should provide the best tax savings.
If you are going to do the taxes yourself check the various websites (IRS) and understand what you can and can't write off.
For example, you can write off expenses if you are pursuing a job in the same or similar industry, however you can't if you are making a career change. You can write off expenses if you did not take a big break between jobs. You can write off job hunting expenses if you are working and planning a career move in the same or similar field. You can't write off if you are looking for your first job such as a college student.There are caveats such as job hunting expenses must be greater than 2% of your total gross income to qualify etc. If you are unsure look it up in a reliable website or go to the ultimate source, the IRS.
General categories for job hunting write-offs
Basic rule of thumb is to document everything and save receipts. Many do this on a spreadsheet or right in the electronic calendar so that you can print or save as a PDF file with clear documentation of dates, interviews, trips etc.
Gary Daugenti of Gent & Associates suggests that individuals save receipts and scan, date, and title the files. This way you can easily find your files a year or two later if the need arises. He also suggests that individuals should back up their files on a regular basis on a back-up drive so that the documents are saved.
There are a number of costs associated with developing your resume. Many can be written off including resume development, resume counseling, copy costs, fees charged for resume rewriting, cover letters, job search help, career guidance.
Some of these costs can be written off such as outplacement fees, career coaches, and fees from employment firms
Job pursuit fees
Advertising, newspapers help wanted ads, social media costs and
subscription upgrades and premiums.
Classes and training costs
This area includes classes and training that enhances your skills and qualifications for jobs that you are pursuing in your field.
These are fees to cover employment contracts and terms.
This refers to activities such as Printing, mailing, telephone calls, cell phone calls. Internet costs- Wi-Fi, internet networking groups, dues and subscriptions It includes industry organizations that you have joined, both physical and virtual, to meet hiring managers
The current rate is 55 cents a mile, networking events, parking fees, mass transit, and food. These expenses are partial write offs. Some up to 50%.
Use a hotel logo envelope to save all the receipts. Take photos to document locations. Save the business cards of your contacts and restaurants and always save receipts.
Women should pay attention to other job hunting expenses such as childcare or babysitting costs while
looking for a job (be sure to have the Social Security number of your childcare
provider). Anne Angelopoulos, Senior Manager of Just Staff reminds you to keep track of home office expenses such as printers, mobile devices Wi-Fi, and office supplies. It may be worth having a professional measure the space that you are using for your home office to determine what percentage of your time the space as well as your computer are used for
work vs. personal activity.
The time and effort invested in determining your expenses should be rewarded with associated deductions on your return. It is never too early to begin planning for next year.
Follow Dr. Tracey Wilen-Daugenti on Twitter: www.twitter.com/traceywilen