Tax Deductions on Work Related Expenses
Taxes are a part of life in the U.S. and if you have a job that earns income, you are responsible for paying the IRS each year. You may already know about some of the potential employment-related tax deductions available for those who are self-employed, but did you know that you might also be able to deduct expenses if you work for an employer and go to an office every day?
We have pulled together some information to help you maximize your deductions on work related expenses this year:
1. Automobile Costs
You are allowed to deduct auto costs for travelling from one office to another, or to and from a business meeting (from your office not your home). You need to keep track of these expenses from one office to another as well as expenses related to a business trip.
If you use your personal vehicle for business related purposes, you can either deduct the cost of the mileage (using the standard rate for the year) or the actual vehicle expenses for the year. You should note that if you lease a vehicle, you must choose which deduction to take (mileage vs. vehicle expenses) and use that for the entirety of the lease.
Keep in mind, however, that there are also travel-related expenses you cannot deduct. These include expenses for driving/commuting to and from home to your primary office, parking and tolls or fees related to getting yourself from home to work. These are considered personal expenses.
2. Business Travel
Business travel is another big area for employee deductions. You are able to deduct the cost of food, baggage, transportation costs, tips, etc. You can even deduct the cost of your passport! The only stipulation here is that you were on the trip for less than 1 year. The IRS website has specifics about what portion of these items are deductible.
3. Expenses Related to a Job Search
You may be surprised to learn that many expenses related to a job search are deductible. This includes travel (to and from the interview), the cost of printing materials for interviews, resume, and more. You can deduct these costs even if you do not get a new job.
4. Home Office Expenses
You can deduct expenses if your home office is your primary place of business.
Dues to professional societies, including political organizations, are often tax deductible.
6. Work Clothes
You can also deduct the cost of work clothes and uniforms that are not practical or suitable for everyday uses that are a requirement for your job.
Do you Qualify?
One important thing to note about all of these potential deductions is that the total expenses that you deduct on your return must be more than 2% of your adjusted gross income. You can only deduct the expenses that are over and above that threshold.
Success Tax Relief can help answer all of your tax questions related to deductions. We can help determine whether you are better off itemizing this year or sticking with the standard deduction. We can also help you with a wide array of other tax related questions, so do not stress over your taxes this year, call our team of professionals at 1-877-825-1179 or contact us here for help and support!