While you were (or are) in college, it’s likely that your parents—or their accountant—handled all your income tax matters. However, once you get your first full-time job, you’ll likely need to start taking more control of your personal finances.
And that means filing your own income tax return. One of the questions that young people often ask about taxes is whether they can claim their job search and moving expenses. There’s not really a straightforward answer, as it all depends on what stage of your career you’re at and what type of job search you’ve conducted.
If you just graduated from college and you’re looking for your first full-time job, you cannot claim any expenses related to the job search, but you can claim moving expenses as long as you moved at least 50 miles away. As usual, the rules change slightly each year, so you will need to check on the applicable rule in effect at the time of your move.
For example, if you made the move in 2016, you can claim the cost of moving your household goods plus 19 cents a mile if you drove your car to the new location. If you make the move in 2017, the reimbursement rate for driving your car drops to 17 cents a mile. The Internal Revenue Service (IRS) publishes helpful guides each year that specifically outline all the deductions you can take for moving expenses.
If you’re changing jobs, you may be able to claim deductions for your job search expenses, but not for any moving expenses you may incur. There are lots of caveats to this option. For instance, you have to stay within the same career field, and your total expenses have to exceed 2% of your adjusted gross income. However, there are lots of items that can be included, such as:
Transportation expenses, including mileage for driving your car as well as airplane, train, bus, and taxi fares.
Food and lodging if you have to travel away from home overnight.
Printing costs for resumes, stationary, and/or business cards, as well as postage for sending those items out to prospective employers.
Fees that you might pay to a career counselor or employment agency.
Again, these rules can change each year, so you should always check with the IRS for the relevant information for the year in which you incur the expenses. An important point to keep in mind for the job search expenses is that you can deduct them even if the search doesn’t result in a new job!