Tuesday, July 3, 2012

Can a Dentist Deduct Job Hunting Expenses? And the IRS Says...

Income Tax—Recent Graduates' Job Search Expenses: 

Expenses incurred by taxpayers when searching for new employment in the same trade or business are deductible as a miscellaneous itemized deduction [IRC Sec. 67(b) ]. Therefore, they are deductible only for regular tax purposes and only to the extent they and other miscellaneous itemized deductions exceed 2% of AGI. While the costs of finding first-time employment are not deductible, since first time employment by definition cannot be in the taxpayer's same trade or business (Rev. Rul. 75-120, 1975-1 CB 55 ), moving expenses associated with first-time employment are deductible if the time and distance tests in IRC Sec. 217(c)(1) are met. According to IRS Pub. 521 , Moving Expenses (For Use in Preparing 2011 Returns) : "If you go to work full time for the first time, your place of work must be at least 50 miles from your former home to meet the distance test."

Thanks for posting!  Do I just need to save receipts for U-Hauls/gas?

Yes, save all receipts and record ALL moving expenses. When you have your return prepared, let the CPA know. They'll let you know what's deductible and what may not be. It’s always better to give us too much info than not enough information....in my opinion.

For more information, please contact info@dentalcpas.com

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