What are these tax deductions?

What tax deductions do you claim as an employed software developer?

• As a professional software developer who receives a W2 from my employer, I'm never sure what sort of tax deductions I can put on my taxes. Throughout the year I make purchases to enhance my skills as a developer, such as: technical/business books, new devices (tablets/phones) and magazine subscriptions. Are these expenses viable deductions to claim on my taxes? What other deductions do you claim?

• Answer:

  You can deduct unreimbursed employee expenses on Line 21 of Schedule A to the extent that those expenses exceed 2% of your adjusted gross income. See http://www.irs.gov/publications/p529/index.html for a detailed description of what this entails. This rarely comes into play for most people because they don't have sufficient unreimbursed expenses to reach the 2% limit, and even if they do it only matters when they have enough other deductions to use Schedule A. As to your specific questions: You can deduct work-related education expenses (including books) when those expenses are for education that is either: needed to maintain or improve skills required by your present job, or required by your employer to keep your salary, status, or job, and the requirement serves a business purpose of your job. You cannot deduct work-related education expenses when that education is needed to meet the minimum requirements of your job, or when that education qualifies you for a new trade or business (even if you have no intention of entering that business). You can deduct the cost of subscriptions to professional journals and trade magazines related to your work. Normally, you would not be able to deduct the cost of new devices (such as tablets and smartphones) unless you are required to purchase or own them as a condition of your employment and your use of them is for the convenience of your employer. You would normally depreciate these over the useful life of the device, rather than deducting them, if they qualify. You can deduct membership dues for professional organizations if those memberships help you carry out the duties of your job. You can deduct the cost of tools and supplies (such as paper and printer ink) that you purchase and that you use on the job.