Job Expenses

Many Americans were unemployed and looking for work during 2010. If you were one of them, read on. There are a number of expenses involved in searching for a job that are deductible. They include the cost of:

 -  Hiring a recruiter, counselor or coach

 -  Employment agency fees

 -  Outplacement services

 -  Preparing your resume, including paper and printing

 -  Postage related to your search

 -  Traveling to and from interviews

 -  Local and long distance phone calls related to your search

 -  Want ads placed in newspapers, journals and magazines

 -  Moving expenses if you are starting a new job at least 50 miles away

Note: If you are going to an out-of-town interview, your train, plane or bus ticket, hotel, meals and taxi fares are deductible. But don't try to turn your trip into a vacation and deduct the full amount. This is something the IRS watches very closely.

And, if you start your own business, certain expenses are deductible. For details, read IRS Publication #535, "Business Expenses" at: http://www.irs.gov/.

Three points to keep in mind...

(1) Not everyone who went job hunting last year qualifies for these deductions. You must have been looking for a job in the same field in which you were previously employed. So if you were a nurses aid and you want to become a paralegal, forget about deducting the cost of looking for a job in a law firm.

(2) And, you can't declare a deduction if you've taken what the IRS calls a substantial break - for example, to cruise around the world. Your search must be within a reasonable amount of time after you lost your previous job.

(3) If your search in 2010 was for your first job, you're out of luck. The IRS allows write-offs only for the expenses involved in searching for another job in your present line of work.

(4) List your qualified expenses on IRS Schedule A and attach it to your 1040.

Caution: You can subtract your job hunting expenses enses from your income only if they (along with other miscellaneous itemized deductions add up to more than 2% of your adjusted gross income. 

Gambling Losses

You may have had a great weekend in Sin City or Atlantic City even though you lost money playing the slots or blackjack. And the good news is that you can deduct your losses against your winnings. However, you cannot deduct losses that exceed your gains.

For Further Information

Be sure to read IRS Publication #529, "Miscellaneous Deductions."  You can download it at: http://www.irs.gov/.