Tax Guidelines for Medical Industry Jobseekers: MedZilla Details What You Need to Know Before You File
If you're like many Americans this tax season, you spent at least part of last year looking for a job. Whether unemployed or under employed, you
likely sent your resume out to someone. Now is your opportunity to cash in those itemized deductions from expenses accumulated during your job
search. Perhaps it seems counterintuitive that you would have anything useful to account for during tax time from a period when you weren't actually working. However,
whether you found a job or are still looking, those miscellaneous expenses could be your key to maximizing your refund.
Stay Within Your Field -- The first thing to keep in mind before you begin sorting your receipts is that for your job search to be deductible, it has to be within your field of expertise. What this means is that no matter what the deductible expense may be, it needs to be related to a job search within your most recent field, or the industry you ultimately ended up finding a job in.
Don't Forget to Include Electronic Receipts -- There are many ways to provide the IRS with proper accounts of your purchases. One way continually getting overlooked are the receipts located and easily downloaded from accounts accessible online. Electronic bank, credit card and bill statements are legitimate and verifiable receipts which can be printed and submitted for audit. So don't go diving forehead first onto your desktop if you suddenly realize you forgot to keep all of your paper receipts rolled up in your lucky sock drawer.
If there are months of records beyond what is available instantly online, corporations are required to keep that data available. There may be a nominal fee for having a paper copy sent to you; however, any money you spend getting records of your expenditures for tax purposes will be deductible on next year's return.
Expenses in Keeping Up with the Industry -- Did you decided to take a seminar, class or second degree to keep up with the latest trends in your field? Did you join an industry or professional association; renew your license; pay for a subscription to any industry journals or a trade magazine? Start making a list; because dues, fees, and even money paid to, or expenses incurred from, a professional head hunter (including job boards) are all deductible. Make a note, however, that there are certain kinds of fees which are not deductible. For example, you may not include the fees you paid for acquiring your initial medical or dental license.
Proceed With Caution -- Remember your documents should demonstrate that your job search began relatively soon after the termination of your previous employment. Also, since deductions related to the search for a new job fall under what are considered "Miscellaneous Expenses", they are subject to the 2% rule. This means that the total amount you deduct as a result of these expenses must not exceed 2% of your total income.
Things You May Not Realize You Can Include:
Remember to make detailed notes on your statements and receipts so you can keep track of which expenses were related to the job search in case of an audit. If you have any questions or for more ideas on which items are officially deductible, consult a tax preparation professional (those expenses will be eligible for deduction next year). You should also make it a point to look over Publication 529 on irs.gov, which outlines the specifics on Miscellaneous Deductions and exceptions to the 2% rule.
Figuring out the specifics on miscellaneous deductions can seem daunting. You may be tempted to save yourself the trouble. However, hundreds or thousands of dollars could be at stake for merely a couple hours of work. Can you really afford not to take advantage of these deductions?