According to the United States Department of Labor, the unemployment rate has reached a record low of 5.9% as of September 2014 compared to each consecutive year since the beginning of the recession in 2008. The decrease sounds great as far as percentages, but that still leaves 9.3 million jobless individuals, of which 7.1 million are actively seeking full-time employment. This number includes part-time workers who were unable to find a full-time position and college graduates who have not been able to begin their careers.
Searching for employment can be a tedious process that has the potential to become financially costly, and adding such expenses to an already strained budget is not something anyone would want to do. The good thing is you may be able to deduct some of the expenses you accrue while on your journey. In Publication 529 for Miscellaneous Itemized Deductions, the IRS provides the job seeker with a list of qualified and nonqualified items, such as:
- Same Occupation: Your expenses must be for a job search in your current line of work. You can’t deduct expenses for a job search in a new occupation.
- Resume Costs: You can deduct the cost of preparing and mailing your resume.
- Travel Expenses: If you travel to look for a new job, you may be able to deduct the cost of the trip. To deduct the cost of the travel to and from the area, the trip must be mainly to look for a new job. You may still be able to deduct some costs if looking for a job is not the main purpose of the trip.
- Placement Agency: You can deduct some job placement agency fees you pay to look for a job.
- First Job: You can’t deduct job search expenses if you’re looking for a job for the first time.
We would all much more prefer to have a Congress that actually does some work and makes decisions that would help stimulate the economy instead of vacationing, but in the meantime the job seeker can take advantage of these qualified deductions.
For more information, contact Potts & Company. We can help you with the details of your situation!