Certain other job search expenses are deductible as well: travel and transportation (as long as the primary purpose is job search), and employment agency fees.
Here is what the IRS says:
“You can deduct certain expenses you have in looking for a new job in your present occupation, even if you do not get a new job. You cannot deduct these expenses if:
- “You are looking for a job in a new occupation,
- “There was a substantial break between the ending of your last job and your looking for a new one, or
- “You are looking for a job for the first time.”
The form goes on to say that “in order to be deductible, the amount that you spend for job search expenses, combined with other miscellaneous expenses, must exceed a certain threshold . . . The amount of your miscellaneous deduction that exceeds two percent of your adjusted gross income is deductible.”
What is meant by “a substantial break” between leaving your job and looking for a new one? The IRS is quite vague on this, so consult with your tax professional if you’re in doubt.
Deductible or not, job search assistance is one of the best investments you can make. If strong interview skills and a compelling resume lead to a job even one paycheck sooner, your investment could easily repay you at 200% or more. Where else can you get an ROI like that?