There are several expenses associated with employment. Some individuals will pay these and never realize they may be beneficial in reducing their tax liability. Many if these deductions may only be claimed on schedule A; however, there are exceptions to this as well.
One such deduction that may be available as an employment expense that is not included on schedule A is the educator expense deduction. This is a deduction available to reduce the taxable income of teachers, counselors, principles, and teachers’ aides. Many additional supplies are necessary that may not be provided by employers of these educators; therefore, this special deduction was created to allow teachers to recoup some of this money without having to file schedule A. The maximum amount you can claim is $250 or $500 if both spouses are qualified educators.
Another common employment expense that is deductible is the purchase of clothing and special safety equipment. Although general clothing is not normally deductible, uniforms that are not “suitable” to wear any other time than to work is a deductible expense. Special safety clothing is also deductible, such as hard hats, steel-toed boots, and safety glasses, which are required for work but are not supplied by your employer.
Dues to professional associations, the local chamber of commerce, and professional journals are also deductible employment expenses. Each of these promotes your knowledge and professional standing; as long as they are common and accepted in your field, they are deductible.
Expenses incurred looking for employment are also considered deductible. Examples may include employment agency fees and other expenses that are paid to find a job in your current field.
The home office deduction also falls into this category. However, there are certain requirements to taking this deduction. Part of your home must be used regularly and exclusively for your business. Therefore, you may not claim parts of your home used for business and personal use. In claiming this deduction you may include the percentage applicable to the portion of the home you utilize of the mortgage, property taxes, insurance, utilities, maintenance and repairs, and depreciation. To analyze these amounts, you may calculate the square footage of the portion of the home used for business purpose and divide by the total size of the home to find the percentage of the property used for the business. This amount can then be multiplied by the expenses to determine the business portion. Certain expense may be limited in claiming this deduction. This deduction may be claimed on schedules A, C, or F depending on the circumstances of the person filing.
Tools of trade and other types of equipment may also be a factor in calculating employment expenses. Small hand tools and other items may be necessary for work. The purchase of these may be deductible.
Likewise, physical examinations and other medical care required by your employer are also deductible. Some companies require drug tests or yearly physicals; these would fall into this category and would be deductible.