Saturday, September 24, 2011
Wall Street Journal, Write Off Your Job Hunt, by Laura Saunders:
It's no secret that millions of Americans are looking for work, from recent graduates to downsized late-career employees who aren't ready to retire. Far fewer are aware of how Uncle Sam's tax code can be used to blunt the cost of a job search—especially one that may go on for longer than in the past....
The tax issues affecting job seekers are numerous, with many parts of the code coming into play. They also are tricky. One key provision—the "miscellaneous deduction"—can severely limit job-hunting write-offs, while another—the "alternative minimum tax"—denies them entirely.
But there are opportunities, especially for people who can earn some income in a side business. "By starting a consulting practice, taxpayers may convert limited write-offs into full deductions," says David Kautter, who heads the Kogod Tax Center for Small Business at American University. ...
Now for more specifics on the tax treatment of everything from severance pay to home-office expenses. See also IRS Publication 4128, Tax Impact of Job Loss. ... Kogod's Mr. Kautter says few if any taxpayers have ever gotten away with taking deductions for work clothing (except uniforms), a briefcase, commuting costs, dry cleaning, haircuts, cosmetics or cosmetic facelifts.