If you searched for a new job last year, you might find that you spent more money than you thought on your efforts. Fortunately, many job search expenses are tax deductible, and knowing what job hunting deductions you qualify for and having your receipts in front of you when you file your taxes can save you some money when you file your taxes.
To make sure you get every dollar you deserve, here are job search expenses that may save you at tax time:
Qualifying for job-hunting tax deductions:
Do you itemize your deductions? If so, you may be in luck. You can take itemized deductions for the expenses you incur when looking for a new job -- such as resume preparation costs, new interview clothes, and travel expenses -- even if your job search is unsuccessful. A key point to remember is that the job you're seeking must be in the same line of work.
If you were on the hunt for a job in a new career field, then you don't qualify. You also will not be allowed to deduct job search expenses if there was a substantial break between your last job and the time you began looking for a new job in the same profession.
Updating your resume:
Did you take the time to spruce up your resume? If so, then this is one job-hunting deduction you are eligible for. Make sure to keep receipts for what you paid to get your resume prepared, printed, and mailed out.
Career coaching and career seminars might also be eligible for a tax deduction. If you signed up for an employment agency and were charged outplacement fees, you may also be able to deduct these costs as well.
Travel high and low:
If your job search required you to travel a bit as you interviewed with prospective employers you may be able to deduct your expenses related to your travel, but make sure you tracked your hotel and transportation expenses. To get the deduction -- make sure the main purpose of your travel was designed specifically to help you find a job in the same career you already work in.
As is the case with any deduction, make sure that you keep good records of all of your expenses. Save your receipts, and be sure to write down what you did, and how the expenditure contributed to your job hunt. TurboTax will ask you simple questions about your life and then do all of the calculations based on your answers, giving you all of the tax deductions and credits you're eligible for.
Do you have other questions about what types of job search related expenses are tax deductible? Be sure to visit the TurboTax blog, or leave me a comment.