Those nice folks at the IRS know job hunting can be stressful. As a reward for trying to find a job during this recession, they would like to give you some money for your efforts. All of the details can be found in their Miscellaneous Deductions publication [PDF], but here are some highlights:
Make sure you are looking for a job that relates to your current occupation. Unfortunately, the IRS does not provide financial incentives for people who want to change career paths.
If you are looking for a job that does relate to your current occupation and you are not a first-time job seeker, you can deduct the following expenses on your tax return:
- Employment and outplacement agency fees
- Money spent preparing and mailing copies of your resume to prospective employers
- Travel to and from a different location only if you went there primarily to find a new job. Hanging out on the beach in Florida only counts as employment travel if this is your current occupation.
Remember that the IRS also rewards you for looking for a job close to home, so keep track of any job-related meetings you attend.
- MapQuest provides an easy way to figure out the number of miles you logged for these meetings - simply type the "to" and "from" addresses into MapQuest and let it calculate the number of miles you drove.
- Multiply the number of miles you drove by $0.50 per mile (the standard IRS mileage rate for 2010) to calculate your tax deduction.
These deductions will be included in the "Job Expenses and Certain Miscellaneous Deductions" area of Schedule A (Form 1040) - Itemized Deductions.
The IRS even has a tax center to assist unemployed taxpayers.
And you never thought dealing with the IRS would give you that warm, fuzzy feeling!