Newspaper article The Christian Science Monitor

Tax Filing for the Jobless: Five Ways to Trim Your Tax Bill

Newspaper article The Christian Science Monitor

Tax Filing for the Jobless: Five Ways to Trim Your Tax Bill

Article excerpt

Tax filing is never fun, especially for the unemployed, whose income plunged but who still owe taxes. The Internal Revenue Service tried to ease things a bit last year by not fully taxing the unemployment benefits. That offer has expired. Still, there are ways that the unemployed, and newly employed, can lower their taxes this tax-filing season. Here are five of them:

Tax filing is never fun, especially for the unemployed, whose income plunged but who still owe taxes. The Internal Revenue Service tried to ease things a bit last year by not fully taxing the unemployment benefits. That offer has expired. Still, there are ways that the unemployed, and newly employed, can lower their taxes this tax-filing season. Here are five of them:

#5 Deduct your job hunt

Maybe you found a job last year, maybe you weren't so fortunate. Either way, you may be able to deduct some of the money you spent looking for a new job. Whether you were unemployed or just looking to enter a new line of work, you might qualify for deductions this tax-filing season.

First, if you paid a job agency for help, you can deduct that expense. You can also deduct any money you spent preparing and sending out resumes, such as paper and postage. And if you traveled to another place to look for a job, you can deduct travel expenses, as long as the trip really was primarily to look for work.

#4 Deduct interest on your student loans

Interest on personal loans is usually not deductible, but in the case of a student loan, it might be. If you make less than $75,000, or if you are a couple that makes less than $150,000, you can deduct the interest that you paid on student loans for higher education.

The loans can be for your own education, your spouse's, or a dependent. In any case, the student must have been enrolled in at least a half-time program. The rule for who qualifies as a dependent is more flexible for student-loan interest deductions than it is in other cases. For instance, you can claim someone as a dependent, even if you are the dependent of another taxpayer. And somebody can be your dependent, even if that person files a joint return with a spouse. …

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