Trimming tax bills
- By Milt x_Zall
- Mar 03, 2002
The tax-filing season is coming up, and it's important to know what
employee business expenses you can deduct on your tax return.
Many employee expenses that haven't been reimbursed can be counted as
miscellaneous deductions if you itemize on Schedule A. As a fed, you're
entitled, like other taxpayers, to deduct employee business expenses if
they exceed 2 percent of your adjusted gross income. Some expenses that
you may not have considered are any ordinary and necessary business expenses,
training and education expenses, and job search expenses.
For an employee business expense to be deductible, it must be incurred
in connection with your job and be an "ordinary and necessary" expense.
An expense is "ordinary" if it is common and expected for the type of work
you do; for example, a briefcase for an attorney. An expense is "necessary"
if it is essential to the successful completion of your job.
Some examples of employee business expenses include:
* Dues to professional societies.
* Use of a home office for an employer's benefit (if the office is used
regularly and exclusively for work).
* Medical examinations required by your employer (not very common for
* Subscriptions to professional journals and trade magazines related
to your work.
* Any supplies used in connection to your work (including software).
* Dues paid to belong to a union or similar organization.
If you have a computer or wireless phone that you use in connection
with your work, it can be depreciated if it's used for the convenience of
your employer and required as a condition of your employment. The "convenience
of your employer" means your employer wants you to have the computer or
wireless phone and tells you to get one or strongly urges you to get one
even though he or she isn't willing to pay for it. It would be a good idea
to get a memo from your supervisor to that effect before you deduct this
The stipulation that the computer or wireless phone be "required as
a condition of employment" means that you absolutely must have a computer
or wireless phone in order to do your job. Someone who telecommutes would
fall into this category if the employer didn't pick up the tab for the necessary
There are other areas to consider for potential deductions, too, such
as training and education expenses and job search expenses. For instance,
did you know that if you travel out of town to look for a new job in your
present occupation, you could deduct travel expenses? For details on these
and other deductions, see "A closer look at fed deductions."
Those are just some ideas that could help you trim your tax bill. If
they sound like they apply to you, check with your accountant or tax adviser
Zall is a retired federal employee who since 1987 has written the Bureaucratus
column for Federal Computer Week. He is also a certified internal auditor
and a registered investment adviser. He can be reached at [email protected].