If you work as an employee and have business expenses related to your work that are not reimbursed by your employer, you may be able to deduct those expenses. The expenses will go on Schedule A, Itemized Deductions. You may also need to use Form 2106 Employee Business Expenses.
In order to be deductible, the expenses must be ordinary and necessary.
- The expenses must be related to your work as an employee.
- They must be common and accepted in the industry you work in.
- A necessary expense is one that is appropriate and helpful to your employer.
Examples:
- Special work clothes that are not appropriate for everyday use.
- Supplies and tools you use on the job.
- Business use of your personal vehicle.
- Business meals and entertainment.
- Business travel away from home.
- Business use of your home.
- Work-related education.
Keep good records of your income and expenses throughout the year.
- Mileage records.
- Receipts for items purchased.
- Receipts for meals, entertainment and travel.
- Documentation for the business use of your home.
- Receipts for work-related education expenses.
If you are a K-12 teacher or educator, you may be able to deduct up to $250 of expenses you have incurred for your classroom. These are deductions to income on the front of your Form 1040, not an itemized deduction.
For more information on employee business expenses, see IRS Publication 529 Miscellaneous Deductions and Publication 463 Travel, Entertainment, Gift, and Car Expenses.
Judith Ackland has more than 26 years of experience in accountancy and financial planning, including seventeen years as a CFO of a diverse business. She started Crystal Financial in 2010 to help a wide array of individuals, families, and business owners better understand their finances and how good financial management could help them achieve their goals. Judith has an MA in Professional Accountancy from the University of Nebraska at Lincoln as well as a Certified Public Accountant Certificate and a Certified Financial Planner designation.
