If you are looking into miscellaneous itemized deductions, it’s important to know that if they're small, you probably will not benefit from them. The category of miscellaneous tax deductions does not fit into any of the other allowable deduction categories, but are still claimed separately as itemized tax deductions.

When you think of "writing something off" on your taxes, you are thinking of something that would fall into miscellaneous tax deductions. And you're probably often wrong because, contrary to common opinion, not many things can be legally deducted.

NECESSARY EXPENSES MUST EXCEED THRESHOLD
There is one rule of thumb you can apply. All the miscellaneous allowable tax deductions are necessary expenses you may incur for the production of income. You can only get a deduction in this catch-all category if your expenses exceed a threshold: two percent of your annual gross income (AGI) in this case.

Miscellaneous tax deductions subject to the 2% limitation
These limited tax deductions include:

• Legal fees
• Appraisal fees
• Investment expenses
• Tax preparation fees
• Cost of education that improves/maintains job skills
• Cost of safe deposit box storing bonds
• Job-seeking expenses (if in the same field as your current job)
• Unreimbursed work-related expenses, such as subscriptions, union    dues, initiation fees, business liability insurance, cost of tools of your    trade, cost of safety equipment and clothing.

• Gambling losses (up to the amount of your winnings)
• Expenses for handicapped individuals
• Federal estate tax
• Bond premiums
• Cessation of annuity

Passing the 2% floor
You get no tax savings unless you pass the two percent floor. Here’s a quick way to determine if you rise above the limit:

• Review the miscellaneous deductions listed above
• Add up the ones you can take
• Calculate 2% of your AGI
• Compare the two figures

If the total is:

• Larger than 2% of your AGI, subtract the 2% figure from your total miscellaneous deductions. The difference is the amount you can actually deduct on your return
• Less than 2% of your AGI, you can't deduct any of these items

Consider bundling - If you're close to meeting the 2% floor one year, try combining some of next year's expenses into that year. For example, rather than wait until January to enroll in that continuing education class, pay your tuition in December. That way, at least every other year you may get some tax savings from your miscellaneous deductions.

Document, document, document!
If you declare any of these allowable tax deductions, written proof of the expenses should be readily available. If you gamble, keep a log of winnings and losses with dates and serial numbers of machines or games you were playing.

Helpful information:

When in doubt, go to the source: www.irs.gov

• For Miscellaneous Deductions, IRS Publication 529
• For Educational Expenses, IRS Topic 513
• For Employee Business Expenses, IRS Topic 511 and Topic 512
• For How To Depreciate Property, IRS Publication 946