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Tax deductions for job search expenses

Some job search expenses can be tax deductible.
Some job search expenses can be tax deductible.

CPA David Young discussed the process Monday morning on News 8 at Sunrise.

Young said you need to itemize your deductions on your income taxes with a form Schedule A.  The standard deduction for a 2013 married couple is $12,200 and for a single filer it is $6,100.

To qualify for a deduction, your expenses must be spent on a job search in your current occupation.  You can deduct employment and outplacement agency fees you pay while looking for a job in your present occupation.  If your employer pays you back in a later year for employment agency fees, you must include the amount you received in your gross income, up to the amount of your tax benefit in the earlier year.

You can also deduct amounts spent preparing and mailing resumes to prospective employers, again within your present occupation.  If you travel to look for a new job, you may be able to deduct expenses incurred to and from the area in which you travelled.  The key factor is whether or not you spend more time on your job search during the trip or enjoying personal time.

You cannot deduct your job search expenses if there was a substantial break between the end of your last job and the time you begin looking for a new one.  The term "substantial break" is not specifically defined, but Young said if you are still drawing unemployment, job search expenses usually are deductible.  In addition, job search expenses are not deductible if you are looking for a job for the first time.

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