Tax Tips If you’re among the millions of people looking for work, be sure to keep receipts and other documents to substantiate job-hunting expenses that may be deductible, including: • Employment and outplacement agency fees, • Travel expenses if the primary purpose of your trip is to look for a new job, • Resumé preparation and mailing expenses, and • Telephone calls to prospective employers. Because job-hunting expenses are considered “miscellaneous itemized deductions,” they’re deductible only to the extent that total deductions in that category exceed 2% of your adjusted gross income. Also, you can’t deduct these expenses if you’re looking for a job for the first time or in a “new occupation,” or if there was a substantial break between the time your last job ended and the time you started looking for a new one. Now’s the time for a cost segregation study If your business has acquired, constructed or substantially renovated a building recently, consider a cost segregation study. Ordinarily, the costs associated with a commercial building are depreciable over 39 years. A cost segregation study applies engineering, tax and accounting principles to identify building components that are eligible for accelerated depreciation, which can dramatically reduce your tax bill. For example, land improvements — such as fences, sidewalks, parking lots and light poles — are depreciable over 15 years. And many building components can be classified as personal property and depreciated over five or seven years. Examples include machinery and equipment, movable partitions, certain wall and floor coverings, awnings, and certain light fixtures. The impact of a cost segregation study can be even more dramatic for projects completed in 2009, because many of these items may also qualify for the enhanced Section 179 expensing election. Ensure names and SSNs match If you get married or divorced this year, notify the Social Security Administration of any name changes before you file your 2009 income tax return. Otherwise, the IRS computers may have trouble matching names with Social Security Numbers (SSNs). This can delay your refund. If you have a child this year, be sure to obtain an SSN for him or her. You’re required to furnish an SSN on your tax return for each child you claim as a dependent. • |