Deductions At Work

At Yang & Associates, Ltd. we dig deep to find all the credits and deductions you're entitled to, so you can be sure to always receive the maximum refund you deserve. Deductions At Work, our occupational-focused system, enables our tax prepare to tailor the tax interview to more accurately address your needs based on your profession.

 

Tax Deduction Checklist

We’ve includes a tax deduction checklist of expenses and income treatments for our customers’ top 40 professions , including nurses, cashiers, laborers, salespersons, truck drivers, teachers, managers, and retirees. Now you can be certain that the questions your tax preparer asks you will lead to the largest refund you can receive. You’ll only find Deductions At Work at our office, where our tax preparers always provide you with the personalized service, attention to detail, and occupational-focused interview that you deserve.

• Accounting Clerk Tax Deduction

• Administrative Assistant Tax Deduction

• Armed Services Personal Tax Deduction

• Assembler Tax Deduction

• Bus Driver Tax Deduction

• Carpenter Tax Deduction

• Cashier Tax Deduction

• Chef Tax Deduction

• Clergy Tax Deduction

• Computer Tax Deduction

• Construction Worker Tax Deduction

• Correctional Officer Tax Deduction

• Custodian Tax Deduction

• Customer Service Representative Tax Deduction

• Daycare Provider Tax Deduction

• Driver Tax Deduction

• Electrician Tax Deduction

• Factory Worker Tax Deduction

• Food and Beverage Service Worker Tax Deduction

• Forklift Operator Tax Deduction

• Hair Stylist Tax Deduction

• Health Care Professional Tax Deduction

• Home Health Care Worker Tax Deduction

• Housekeeping Service Worker Tax Deduction

• Janitor Tax Deduction

• Journalist Tax Deduction

• Laborer Tax Deduction

• Machinist Tax Deduction

• Maintenance Worker Tax Deduction

• Manager Tax Deduction

• Mechanic Tax Deduction

• Media Professional Tax Deduction

• Military Service Member Tax Deduction

• Office Worker Tax Deduction

• Package Handler Tax Deduction

• Painter Tax Deduction

• Performing Artist Tax Deduction

• Plumber Tax Deduction

• Production Worker Tax Deduction

• Retail Sale Worker Tax Deduction

• Retiree Tax Deduction

• Salesperson Tax Deduction

• Security Specialist Tax Deduction

• Student Tax Deduction

• Supervisor Tax Deduction

• Teacher Tax Deduction

• Tradesperson Tax Deduction

• Truck Driver Tax Deduction

• Unemployed Tax Deduction

• Waiter/Waitress Tax Deduction

• Warehouse Worker Tax Deduction

• Welder Tax Deduction

 

If you work in an office as a secretary, administrative assistant, or accounting or data entry clerk, you should receive Form W-2, Wage and Tax Statement, from your employer.

 

You may be able to reduce your taxes by deducting unreimbursed, job-related expenses. You should keep receipts to substantiate these expenses. Examples of some of the items you may be able to deduct include:

·         Subscriptions to publications and journals related to your work

·         Dues for professional associations

·         Job-related equipment or supplies that are replaceable within one year

·         State or local government regulatory fees, licenses, or flat rate occupational taxes, provided these fees are not paid for initial certification or licensing

You also may be able to deduct work-related education courses or seminars if they meet certain requirements. Education typically meeting the requirements includes refresher courses, courses on current developments, and vocational courses. However, education that qualifies you for a new trade or business or that helps you to meet the minimum education requirements of your present trade or business is not deductible. For example, an administrative assistant cannot deduct the expenses of going to a college to obtain a biology degree.

 

 

If you work in an office as a secretary, administrative assistant, or accounting or data entry clerk, you should receive Form W-2, Wage and Tax Statement, from your employer.

 

You may be able to reduce your taxes by deducting unreimbursed, job-related expenses. You should keep receipts to substantiate these expenses. Examples of some of the items you may be able to deduct include:

·         Subscriptions to publications and journals related to your work

·         Dues for professional associations

·         Job-related equipment or supplies that are replaceable within one year

·         State or local government regulatory fees, licenses, or flat rate occupational taxes, provided these fees are not paid for initial certification or licensing

You also may be able to deduct work-related education courses or seminars if they meet certain requirements. Education typically meeting the requirements includes refresher courses, courses on current developments, and vocational courses. However, education that qualifies you for a new trade or business or that helps you to meet the minimum education requirements of your present trade or business is not deductible. For example, an administrative assistant cannot deduct the expenses of going to a college to obtain a biology degree.

 

If you are in the military, you should receive Form W-2, Wage and Tax Statement, which reports your military pay. Some or all of the pay you received for military service in a combat zone may have been excluded from your taxable income. Commissioned officers' excludable compensation is limited to the maximum enlisted amount. The military paymaster should have already calculated this exclusion, and it should not appear on your Form W-2, Box 1. The excluded portion of your pay is exempt from federal income tax, but remains subject to Social Security and Medicare taxes, and is included with Social Security wages on your Form W-2, Box 3 and with your Medicare wages and tips in Box 5. Depending on your state, the excluded pay may be taxable to your state.

 

If the wages reported on your Form W-2, Box 1 include military pay that should have been excluded from your income under the combat zone exclusion provisions, you must get a corrected Form W-2 from your finance office. You cannot exclude on your return the amount that was incorrectly reported on Form W-2, Box 1 without getting a corrected Form W-2.

 

You may be able to reduce your taxes by deducting certain unreimbursed expenses related to your employment with the military. Examples of some of the items you may be able to deduct include:

·         Professional dues (but not dues paid to an officers' club or a noncommissioned officers' club) and subscriptions to professional journals

·         Cost and cleaning of military battle dress uniforms (including rank insignia, medals, accoutrements, epaulets, and swords) and reservists' uniforms if you cannot wear them off duty

·         Job-related training

·         Moving expenses if on active duty and the move is based on a permanent change of station order (PCS order)

·         Travel, meals (with limitations), mileage, and laundry expenses if incurred while traveling away from home (for example, to perform authorized drills and training duty). For military travel deductions, "home" is your permanent duty station and may not necessarily be where you or your family live.

Special Laws and Provisions

Other special tax relief provisions available to members of the Armed Forces and their families include:

·         You may be able to use your nontaxable combat pay to recalculate to your advantage certain credits such as the Earned Income Credit and the Additional Child Tax Credit.

·         You may also be able to use your nontaxable combat pay to recalculate your eligibility to make a contribution to an IRA (and take a deduction and/or credit and receive a refund) for tax years beginning with 2004, even if you make the contribution now.

·         If you received a military base realignment and closure benefit after November 11, 2003, the benefit is generally excludable from income.

·         Benefits you received under a dependent-care assistance program are nontaxable.

·         If you received a death gratuity as a survivor of a member of the Armed Forces who died after September 10, 2001, you may exclude up to $12,420 from income. You may be able to claim a refund if you paid tax on a death gratuity you received because of a death that occurred after September 10, 2001.

·         The five-year period used in determining whether you can exclude gain from the sale of your main home may be suspended during the period you or your spouse served on qualified official extended duty as a member of the Armed Forces. This change applies to any sale of a main home after May 6, 1997; you may be able to claim a refund if you paid tax on a gain from a sale after that date.

·         If you received a distribution from a qualified tuition program (QTP) or a Coverdell education savings account (Coverdell ESA), you may not have to pay the 10% additional tax on the part of the distribution that normally would be included in gross income. To qualify, the designated beneficiary must have attended one of the three military academies (U.S. Military Academy at West Point, U.S. Naval Academy at Annapolis, or U.S. Air Force Academy at Colorado Springs), the Coast Guard academy, or the Merchant Marine academy and the distribution must not exceed the costs of advanced education attributable to that attendance.

·         Members of the National Guard or Reserve may qualify for an above-the-line deduction for travel expenses when reporting for reserve training/duty over 100 miles from their home.

Income tax liability is forgiven (does not have to be paid) for an active member of the U.S. Armed Forces who dies from wounds, disease or injury received in combat. The tax liability is forgiven for the tax year in which the death occurred. Additionally, tax liability is forgiven for any other year ending on or after the first day the member served on active duty in a combat zone. Any tax liability that qualifies to be forgiven, yet has already been paid, will be refunded. Unpaid taxes for prior years will also be forgiven.

 

Specific Tax Tips

The inclusion of combat pay in the earned income calculation for EIC remains an option for military members. Electing to include the combat pay may allow you to increase your EIC. Alternately, electing the option to exclude combat pay from your income may allow you to qualify for EIC. The election offers military members who have nontaxable income due to the combat zone exclusion provision a unique opportunity to determine the highest allowed EIC for their tax situation.

 

If you are a production worker, factory worker, or warehouse worker, you should receive Form W-2, Wage and Tax Statement, for income from wages you receive as an employee from your employer.

 

You may be able to reduce your taxes by deducting unreimbursed, work-related expenses. These expenses may be claimed as miscellaneous itemized deductions on Schedule A, Itemized Deductions, and you should keep receipts to substantiate them.

 

Examples of some items you may be able to deduct include:

·         Subscriptions to work-related publications

·         Union dues

·         Safety equipment, such as steel-toed boots

You also may be able to deduct work-related education courses or seminars if they meet certain requirements. Education typically meeting the requirements includes refresher courses, courses on current developments, and vocational courses. However, education that qualifies you for a new occupation or business or that helps you to meet the minimum education requirements of your present trade or business is not deductible.

 

If you are a driver, such as a bus driver, taxicab driver, or truck driver, you may receive Form W-2, Wage and Tax Statement, for income from wages you receive as an employee. If you received a Form W-2 and the 'Statutory employee' check box in Box 13 is marked, report that income on Schedule C, Profit and Loss from Business. Statutory employees include certain agent or commission drivers.

 

If you are a self-employed driver, report your income on Schedule C. You may account for self-employment income yourself or you may receive Form 1099-MISC, Miscellaneous Income. Also, any tips you receive, such as tips received as a taxicab driver, are taxable income. If you are self-employed and your net earnings are $400 or more, you must pay self-employment tax on the income you report on Schedule C. In addition, you may need to make estimated payments to cover the amount of self-employment tax or income tax associated with the income you report on Schedule C.

 

You may be able to reduce your taxes by deducting unreimbursed, work-related expenses. If you are an employee, these expenses may be claimed as miscellaneous Itemized Deductions on Schedule A, Itemized Deductions. If they are attributable to being a statutory employee or self-employed, they may be deductible on Schedule C. You should keep receipts to substantiate these expenses.

 

Examples of some items you may be able to deduct include:

·         Vehicle expenses (for example, parking fees and tolls; standard mileage rate if not deducting actual expenses; and actual expenses such as maintenance and repairs, fuel, oil, registration fees, insurance, tires, and depreciation if you own the vehicle)

·         Travel Expenses, including lodging, meals (with limitations), and laundry expenses if incurred while traveling away from home

·         Union and trade association dues

·         State or local government licenses and regulatory fees

·         Flat-rate occupational taxes and excise taxes (for example, heavy highway vehicle use tax)

·         Liability insurance premiums

·         Subscriptions to trade publications

·         The cost and upkeep (for example, cleaning) of uniforms if they are required for work and not suitable for everyday wear (for example, the cost of safety shoes and gloves for a truck driver carrying blacktop) Note: If you wear a company uniform but are not required to wear it, you cannot deduct uniform expenses.

·         Leasing costs (for example, a truck driver's trailer rental fees or a taxicab driver's rental fees paid to a cab company for the use of its vehicles)

Other expenses related to truck drivers include cargo losses and damage claims if cargo costs were included in income and pay to other drivers who assist you with your job. If these drivers are your employees (instead of independent contractors), you may be responsible for paying employment taxes, such as Social Security tax, Medicare tax, and federal unemployment tax. Taxicab drivers may deduct fees paid to a cab company for dispatch service.

 

When determining vehicle expenses, you cannot use the standard mileage rate for vehicles used for hire such as a taxicab or a bus.

 

Travel Expenses

To deduct travel expenses, you must be traveling away from home, which means your duties require you to be away from the general area of your tax home longer than an ordinary workday, and you need to sleep or rest to meet the demands of your work while you are away from home. You cannot satisfy this rest requirement by merely napping in your vehicle or grabbing a quick bite to eat. Also, you do not have to be away for a whole day, or from dusk to dawn, as long as your break from work is long enough for you to get the necessary sleep or rest. Most local drivers do not have travel expenses. However, as a long-distance truck driver, you may deduct travel expenses if you can substantiate expenses. You need to keep receipts or maintain a log with such information as the amount, time, place, and business purpose of the travel expenses incurred. Maintaining a log book with cities, distance, and driving time or keeping track of the number of hours driven and the number and duration of the stops may not be enough to support a deduction for travel expenses.

 

You must determine the location of your tax home before you can determine whether you are traveling away from it.

·         Generally, your tax home is your regular place of business. It does not matter where you live.

·         Your tax home includes the entire city or general area in which your business or work is located.

·         If you have more than one regular place of business, your tax home is your main place of business.

·         If you do not have a regular or a main place of business because of the nature of your work, your tax home may be the place    where you regularly live.

·         If you do not have a regular place of business or post of duty and there is no place where you regularly live, you are considered a transient and your tax home is wherever you work.

For example, the tax home of a driver usually is where they begin and end a trip, even if they live somewhere else. A self-employed truck driver's tax home may be at the headquarters where the trucking assignments are given out, even if that is far from where they live.

 

Meal Allowance

You may use the standard meal allowance instead of actual meal expenses when calculating your deduction for meal expenses while traveling away from your tax home. The standard meal allowance rate for most small localities in the United States is $39 per day. Most major cities and many other localities in the United States qualify for higher standard meal allowances. You can use a special standard meal allowance if you work in the transportation industry, which includes those whose work directly involves moving people or goods by bus or truck, regularly requires them to travel away from home, and, during any single trip, usually involves travel to areas eligible for different standard meal allowance rates. If this applies to you, you can claim a standard meal allowance of $52 per day ($58 per day for travel outside the continental United States). Using the special rate for transportation workers eliminates the need for you to determine the standard meal allowance for every area where you stop for sleep or rest. If you choose to use the special rate for any trip, you must use the special rate for all trips you take that year instead of using the regular standard meal allowance rates. The latest meal rates are published online by the IRS in Publication 1542, Per Diem Rates. This publication is only available online and is updated throughout the year as new per diem rates are announced by the General Services Administration. Generally, you can deduct only 50% of your business-related meal expenses. However, you can deduct 75% of your meal expenses while traveling away from your tax home if the meals take place during or in conjunction with any period subject to the Department of Transportation's "hours of service" limits. For example, interstate truck operators and bus drivers who are under Department of Transportation regulations are subject to these limits. If you purchase fuel for buses used in certain ways, you may qualify to claim a fuel tax credit. For example, if you are a bus driver and purchase gasoline for a bus available for chartering by the general public, you may qualify for this credit.

 

If you are tradesman, including a computer technician, electrician, carpenter, construction worker, forklift operator, mechanic, machine operator, painter, plumber, welder or laborer, you should receive Form W-2, Wage and Tax Statement, from your employer. Payments that you receive for providing trade services, outside of or in addition to your regular job, may be considered income from self-employment and reportable on Schedule C, Profit or Loss from Business. For example, self-employed income would include payments received for installing overhead fans in a residence or wiring backyard lighting for a homeowner. For such arrangements, you may account for the income amounts yourself or you may receive a Form 1099-MISC, Miscellaneous Income. If you are self-employed and your net earnings are $400 or more, you must pay self-employment tax on the income you report on Schedule C. In addition, you may need to make estimated payments to cover the amount of self-employment tax or income tax associated with the income you report on Schedule C.

 

You may be able to reduce your taxes by deducting un-reimbursed, job-related expenses. These expenses may be claimed as miscellaneous Itemized Deductions on Schedule A, Itemized Deductions, or, if attributable to self employment, they may be deductible on Schedule C. You should keep receipts to substantiate these expenses. Examples of some of the items you may be able to deduct include:

·         Subscriptions to trade journals related to your work

·         Dues for trade associations or unions

·         Insurance premiums for protection against liability or wrongful acts

·         Specialized equipment or tools that are replaceable within one year

·         Safety equipment such as steel-toed shoes or boots

·         The cost and upkeep of uniforms if they are required for work and not suitable for everyday wear (for example, specialized coveralls, hard hat, work gloves, safety shoes, and goggles not suitable as street wear)

·         State or local government regulatory fees, licenses, or flat rate occupational taxes, provided these fees are not paid for initial certification or licensing

You may be able to deduct job hunting expenses you have while you are temporarily unemployed as long as your new job is in the same field of work as your previous job. Holding odd jobs during the period of temporary unemployment does not disqualify you from deducting the job hunting expenses. For example, a plumber working temporarily as a pipe fitter until finding another plumbing job may deduct job hunting expenses.

 

You also may be able to deduct work-related education courses or seminars if they meet certain requirements. Education typically meeting the requirements includes refresher courses, courses on current developments and vocational courses. However, education that qualifies you for a new trade or business or that helps you to meet the minimum education requirements of your present trade or business is not deductible. For example, an electrician cannot deduct the expenses of going to general contractor school to become a contractor.

 

Additional expenses may be deductible if you are a self-employed tradesman filing Schedule C. Examples of some items you may be able to deduct include:

·         Business bad debts

·         Car and truck expenses when getting from one work site to another

·         Employee salaries or other forms of compensation such as bonuses or commissions

·         Legal and professional fees, such as accounting or legal advice that are directly related to the operation of your business

·         Rental expense for business use property such as trailer and equipment rentals

·         Travel expenses for traveling away from your business home if you are required to be away from home for longer than an ordinary day's work -

           examples of deductible travel expenses include transportation by car, air, or bus, tolls and parking fees, lodging, and meals (with limitations)

·         Advertising

·         Tool and equipment repairs and maintenance

·         Supplies and incidental materials

·         Excise taxes and personal property taxes imposed on your business