Authored By: Tara Williams is a CPA in the Logan office of Cook Martin Poulson, P.C. Tara enjoys interacting with clients and working with them to create solutions to problems. Tara is a native of Layton and earned a bachelor’s degree in accounting from Utah State University and a master’s degree in accounting from Weber State University.
Generally, clothing costs aren’t allowable as ordinary and necessary business expenses. They are characterized as nondeductible personal expenses. The IRS describes clothing that would qualify for a deduction as “required by the employer and not suitable for everyday use.” Most clothing worn to work could be required by an employer depending on the environment, but the key is that it cannot be adaptable for everyday use outside of work. Clothing that would qualify as a deduction include:
• Uniforms worn by firefighters, police officers, letter carriers, healthcare workers, professional athletes, and delivery workers.
• Clothing that protects workers from injury, i.e., glasses, hardhats, work gloves, and safety shoes. See IRS publication 529 for more information.
In a 2011 tax court case, Leyla Diaz was employed as an assistant to the operations manager at a company that owned and operated 11 Midas locations. According to Leyla, she was required by her employer to wear “standard khaki pants, a red polo shirt, and sneakers.” She explained that she did not wear her work clothing other than in connection with her employment. She attempted to deduct $1,400 of clothing and shoe expenses on her tax return as unreimbursed employee business expenses. The court ruled that because the clothing was adaptable to general use, she was not entitled to a uniform and shoe expense deduction. Had Leyla been a service technician that was required to wear a uniform and safety gear, those expenses would have been allowable.
Before taking the uniform tax deduction, keep in mind the two steps that are required for the deduction. Uniforms must be required by your employer and cannot be suitable for everyday use. If you have any questions feel free to contact your CPA at Cook Martin Poulson, PC.