If you are an employee with unreimbursed work-related expenses, you may be able to deduct them as an itemized deduction on Schedule A. You can deduct all unreimbursed employee business expenses incurred in the normal course of carrying out your responsibilities as an employee. Note that employee business expenses are subject to the 2% of AGI limitation, meaning that they must exceed 2% of your adjusted gross income before you can claim the deduction
You can deduct only unreimbursed employee business expenses that are:
• Paid or incurred during your tax year.
• Incurred for carrying on your trade or business as an employee.
• Ordinary and necessary.
An expense is ordinary if it is common and accepted in your trade, business, or profession. An expense is necessary if it is appropriate and helpful to your business.
The following expenses can be claimed as employee business expenses, as long as all the laid down conditions are met.
• Travel expenses
• Meal and entertainment expenses
• Business gift expenses
• Local transportation expenses
• Car expenses
• Home office expenses
We will expound in detail on each category of employee business expense, in subsequent articles.
The primary objective of this article is to empower taxpayers to learn to do their own taxes. For detailed information on how to deduct your employee business expenses, grab yourself a copy of “Doing Your Own Taxes is as Easy as 1, 2, 3” on TaxConnections.com.