Miscellaneous deductions are tax breaks that generally don’t fit into a
particular tax category. They can help reduce taxable income and the
amount of taxes owed. For example, some employees can deduct certain work
expenses like uniforms as miscellaneous deductions. To do that, they must
itemize their deductions instead of taking the standard deduction on their tax
return.
Here are several tips from the IRS about miscellaneous deductions:
- The
Two Percent Limit. Most miscellaneous costs are deductible only if
the sum exceeds 2% of the taxpayer’s adjusted gross income (AGI).
For example, before being able to deduct certain expenses, a taxpayer with
$50,000 in AGI must come up with more than $1,000 in miscellaneous
deductions. Expenses may include:
- Unreimbursed employee
expenses.
- Job search costs for a
new job in the same line of work.
- Job tools.
- Union dues.
- Work-related travel and
transportation.
- The cost paid to
prepare a tax return. These fees include the cost paid for tax
preparation software. They also include any fee paid for e-filing a
return.
- Deductions
Not Subject to the Limit. Some deductions are not subject to the 2% limit. They
include:
- Certain casualty and
theft losses. In most cases, this rule is for damaged or stolen property
held for investment. This may include property such as stocks, bonds and
works of art.
- Gambling losses up to
the total of gambling winnings.
- Losses from Ponzi-type
investment schemes.
Taxpayers can’t deduct some expenses. For example, personal living or family
expenses are not deductible. To claim allowable miscellaneous deductions,
taxpayers must use Schedule
A, Itemized Deductions. For more about this topic, see Publication
529, Miscellaneous Deductions. Get them on IRS.gov/forms
at any time.
Avoid scams. The IRS will never initiate contact using social media or text
message. First contact generally comes in the mail. Those wondering if they owe
money to the IRS can view
their tax account information on IRS.gov to find out.
Additional IRS
Resources:
- Tax
Topic 508 – Miscellaneous Expenses
- Interactive
Tax Assistant tool – Can I Claim My Expenses as Miscellaneous Itemized
Deductions on Schedule A (Form 1040)?
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