Tracy’s Tax Tips: Out Of Work

If you are out of a job, there are some deductions you can make on your tax returns that could be of help.

Tracy Byrnes from the FOX Business Network explains:

12 million Americans were searching for new jobs in 2012. ? Now, fortunately, Uncle Sam understands how expensive this can be and allows you to deduct some of those expenses on your Federal income tax return.

I’m Tracy Byrnes with the FOX Business Network, here with Tracy’s Tax Tips.

These job search expenses are considered miscellaneous expenses subject to that pesky 2% floor. That means the total of your miscellaneous expenses must be above 2% of your adjusted gross income (AGI) before you can take any deductions. And, keep in mind, you can only deduct the cost of looking for a new job in your current occupation. So, if you’re a lawyer looking for a new job as a lawyer, you’re good. But if you decide to go back to school to become a math teacher, forget it.

Then include agency fees, costs for preparing and mailing copies of your resume. And, the fees you pay to post your resume online, on services like monster.com. So what can’t you deduct? Personal expenses, including the costs of haircuts and interview suits, even if you really needed them for your job search.