When you are looking to find another job that is in the same field that you currently work in, you might be able to deduct job search expenses that qualify on your federal taxes.
Here are some good points to remember about what you can deduct as far as your job search is considered.
1. To be able to take the deduction your expenses have to be for a job in the field that you are in already and not in a new field of work.
2. A nice point is that you are able to take a deduction(s) for the employment agency fees or even outplacement fees.
If you get paid from your employer for the fees in a following or later year you will have to claim that money as part of your gross income but only up to the amount of the tax benefit for the year that you received them.
3. Take a deduction for the amount of money that you spend preparing and mailing your resume to newer employers as long as it is in your current occupation.
4. Take the travel expense deduction and use a mileage log to keep track of mileage for job searches in the same field.
If you spend too much time doing something else on the trip, it will not be deductible. That is an area where you should be careful.
5. If you are looking for a job for the first time you can't take a deduction for that. You can't deduct if there was a long term break in time between you ending your last job and trying to find one in the field.
6. You can only claim a certain amount for job search so use the IRS form Schedule A - itemized deductions.
The deductions have to add up to at least 2% of your adjusted gross income and are claimed in the miscellaneous itemized deductions category.
"Job search expenses" has more information.
See IRS Publication 529, Miscellaneous Deductions.
Roger Chartier - The Author