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Disclaimer and Warning - From Bob Parrish CPA, P.C.

Employee Business Expenses

General Information About Employee Expenses

There are many types of expenses offering tax cutting opportunities. The following are offered to assist you with these tax write-off's:

You must itemize to deduct these
You must reduce the write-off amounts be the amount the employer reimburses you
You must know whether your employer maintains an "Accountable Plan"
You must know whether your employer includes your reimbursements in your W2
You must keep records showing -
1. When you paid for the item
2. How much you paid
3. The amount was paid from your funds, not those of another person
4. What it was for
5. How it related to your job and its necessity for business/job purposes

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Sample Deductions

Books for your trade or profession

Business liability insurance premiums

Damages you pay to a former employer for a breach of employment contract

Depreciation on job-related equipment that you purchased. (For info on the mysteries of depreciation, see IRS Publication 946, How to Depreciate Property).

Dry cleaning costs for your uniforms or protective clothing (not for your everyday clothing, though)

Dues to a professional organization, if the organization represents people in your profession

Dues to chambers of commerce and similar organizations if the membership helps you carry out your job duties and the organization's main purpose is not to provide entertainment or entertainment facilities

Educational expenses related to your present job

Entertaining costs that are directly related toÂ business or are associated with businessÂ (only 50% of the cost is deductible)

Expenses for an office in your home if part of the home is used regularly and exclusively for your work, and use of your home office is for the convenience of your employer. (This deduction raises the IRS' eyebrows, so make sure you really meet these criteria. If in doubt, read Rules for Taking the Home Office Deduction, or IRS Publication 587, Business Use of Your Home.) .

Gifts, but only up to $25 per recipient (except for inexpensive, token items such as imprinted pens)

Job dismissal insurance premiums

Job hunting expenses (see details below)

Licenses paid to state or local governments

Meals that are directly related to business or are associated with business (only 50% of the cost is deductible)

Medical exams required by your employer

Occupational taxes if they're charged at a flat rate by your city or other local government for the privilege of working in that area

Protective clothing and gear

Regulatory fees for your profession

Research expenses incurred by a college professor

Safety equipment, such as hard hats, safety glasses, safety boots, and gloves
Specialized clothing designed for your job, as long as they're not suitable for everyday wear

Subscriptions to publications for your trade or profession

Supplies you use in your job

Tools you use in your job

Transportation between your home and a temporary work location if you have no regular place of work but you ordinarily work in the metropolitan area where you live and the temporary work location is outside that area

Transportation between your home and a temporary work location if you have at least one regular workplace for this employment. It doesn't matter how far away the temporary location is in this case.

Transportation from one job to another if you work two places in one day

Travel costs incurred while away from home on business for your employer

Travel costs paid in connection with a temporary work assignment

Uniforms (unless you're full-time active duty in the armed forces)

Union assessments for benefit payments to unemployed union members

Union dues

Union initiation fees

Job Hunting Expenses

You can deduct expenditures you make while looking for a new job as long as you are looking for a job in your present line of work (that is, you're not changing professions).

Examples of expenses incurred while searching for a new job:

Advertising

Career counseling to assist you in improving your position

Employment agency fees

Executive recruiters' fees

Meal expenses: Half of your the cost of meals you pay for that when they are directly related to your job search

Legal and accounting fees you pay in connection with employment contract negotiations and preparation

Long distance calls to prospective employers

Newspapers you purchase to read the employment ads

Other business publications you purchase to read the employment ads

Portfolio preparation costs

Resume preparation (drafting, typing, printing, mailing, faxing)

Transportation costs when traveling to job interviews

Travel to get a job. If you take a trip away from home to look for a new job, your expenses for traveling, lodging, meals (50% of the cost), etc. are deductible only if the primary purpose of your trip is to look for a job. To substantiate the purpose of your trip, keep a daily log of your travel, interviews, and, application efforts.

Proof The IRS Requires

To be added in the future

Prepare for Your Adviser

The following will be added in the future

When we prepare your tax organizer be certain to place those costs in the appropriate section

Entrance Interview

Exit Interview

From Banking Records

From Customer Records

From Signed Documents

From Your Other Business, or Financial Records

From Corporation or Organization Records (meetings, etc.)

Forms - checklists, time-line to do, etc.

Assistance - What to do

Forms - Checklists - Etc.

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Spreadsheets & Computations

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Compliance - what is required for protection, defense, etc.

Compliance Checklist

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Alerts & Dangers - Risks, Asset Protection, IRS Defense

Action Checklist

Alerts & Dangers - Risks
Asset Protection
Your Defense

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