Job Search Expenses May be Deductible

People often change their job in the summer. If you look for a job in the same line of work, you may be able to deduct some of your job search costs. Here are some key tax facts you should know about if you search for a new job:

• Same Occupation.  Your expenses must be for a job search in your current line of work. You can’t deduct expenses for a job search in a new occupation.
  
• Résumé Costs.  You can deduct the cost of preparing and mailing your résumé.
  
• Travel Expenses.  If you travel to look for a new job, you may be able to deduct the cost of the trip. To deduct the cost of the travel to and from the area, the trip must be mainly to look for a new job. You may still be able to deduct some costs if looking for a job is not the main purpose of the trip.
  
• Placement Agency. You can deduct some job placement agency fees you pay to look for a job.
  
• First Job.  You can’t deduct job search expenses if you’re looking for a job for the first time.
  
• Substantial Job Break.  You can’t deduct job search expenses if there was a long break between the end of your last job and the time you began looking for a new one.
  
• Reimbursed Costs.  Reimbursed expenses are not deductible.
  
• Schedule A.  You usually deduct your job search expenses on Schedule A, Itemized Deductions. You’ll claim them as a miscellaneous deduction. You can deduct the total miscellaneous deductions that are more than two percent of your adjusted gross income.
  
• Premium Tax Credit.  If you receive advance payments of the premium tax credit it is important that you report changes in circumstances, such as changes in your income or eligibility for other coverage, to your Health Insurance.
  
• Marketplace. Other changes that you should report include changes in your family size or address.  Advance payments of the premium tax credit provide financial assistance to help you pay for the insurance you buy through the Health Insurance Marketplace. Reporting changes will help you get the proper type and amount of financial assistance so you can avoid getting too much or too little in advance.

For more on job hunting refer to Publication 529, Miscellaneous Deductions. You can get IRS tax forms and publications on IRS.gov/forms at any time.

Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS. These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on IRS.gov

Additional IRS Resources:

• Publication 463, Travel, Entertainment, Gift, and Car Expenses
• The “What Ifs” for Struggling Taxpayers
• Publication 4128, Tax Impact of Job Loss
• Publication 5152: Report changes to the Marketplace as they happen  English | Spanish

IRS YouTube Videos:

• Job Search Expenses – English | Spanish | ASL
• What If – English | Spanish | ASL
• Premium Tax Credit – English | Spanish | ASL
• Premium Tax Credit: Changes in Circumstances – English| Spanish

IRS Podcasts:

• Premium Tax Credit – English | Spanish
• Premium Tax Credit Changes in Circumstances – English | Spanish

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Raking in Tax Breaks from Gambling - Losses are deductible against winnings

Do you like to gamble for entertainment? If the answer is “yes,” it is important to understand all the tax rules related to gambling wins and losses. Otherwise, you may end up paying considerably more taxes than necessary.

Basic Premise: Gambling winnings constitute taxable income on the federal level. It does not matter how and where you win. It could be at a church raffle or the racetrack or a casino aboard a cruise ship. In any case, you owe tax to Uncle Sam on the income. Depending on the type and amount of your winnings, the payer may provide you with a Form W-2G and may withhold federal income tax from the payment.

2014 Standard Mileage Rates

IR-2013-95, Dec. 6, 2013

WASHINGTON — The Internal Revenue Service today issued the 2014 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.

Beginning on Jan. 1, 2014, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

• 56 cents per mile for business miles driven
• 23.5 cents per mile driven for medical or moving purposes
• 14 cents per mile driven in service of charitable organizations

IRS Offers Tips for Year-End Giving

IR-2013-98, Dec. 16, 2013

WASHINGTON — Individuals and businesses making contributions to charity should keep in mind several important tax law provisions that have taken effect in recent years. Some of these changes include the following:

Special Tax-Free Charitable Distributions for Certain IRA Owners.

This provision, currently scheduled to expire at the end of 2013, offers older owners of individual retirement arrangements (IRAs) a different way to give to charity. An IRA owner, age 70½ or over, can directly transfer tax-free up to $100,000 per year to an eligible charity. This option, first available in 2006, can be used for distributions from IRAs, regardless of whether the owners itemize their deductions. Distributions from employer-sponsored retirement plans, including SIMPLE IRAs and simplified employee pension (SEP) plans, are not eligible.