Uncle Sam is on your side when it comes to job-search expenses. After all, you're worth more in taxes when you're gainfully employed. To prove his interest, you may be able to deduct some of your expenses if you're job hunting.

The qualifier is that you must be seeking a job in the same occupation you've been in. If you're looking for a job in a different occupation, these deductions don't apply. You don't have to be unemployed to take them.

"You can't deduct expenses if you're seeking employment for the first time or have been out of work for a substantial amount of time and are looking to re-enter the market," says Steve Horn, a certified public accountant and senior tax partner with Williams Benator & Libby LLP, a business- and tax-consulting firm in Atlanta. The Internal Revenue Service doesn't provide clear guidance on the length of time that you'd have to be unemployed before you aren't allowed to take these deductions.

Deductible expenses may include long-distance phone calls; the cost to type, print and mail resumes; job counseling; employment- and outplacement-agency fees; and placing ads in a local newspaper, trade magazine or Web site. If you're traveling to interviews, you can deduct the expense to and from the meetings. Be sure to save your receipts because if you're audited, you'll need documentation.

The second major caveat is that you need to itemize your deductions to take advantage of your job-search expenses. And then you can only deduct the portion of your qualified job-search costs that exceed 2% of your adjusted gross income (AGI), says Mr. Horn.

"For example, if your adjusted gross income for the year is $100,000, your deduction threshold is $2,000," he says. "If your miscellaneous itemized deductions, including job-search expenses, for the year are $3,000, you can deduct $1,000 of expenses."

Deductible expenses can go beyond the job-search basics. When Paul Graves was looking for a job he knew he had to stay current in his field. After 12 years with the Coca-Cola Co., the 53-year-old group vice president and director of human resources for Africa and the Middle East had turned down a reassignment to London to remain in Atlanta. He accepted a generous retirement package, which included outplacement services.

"Fortunately, most of my job-search expenses were picked up by my former company," he says. Continuing-education and travel costs weren't. "Since I wanted to keep up with organizational design, I invested about $1,500 in books and seminars," says Mr. Graves. "I also flew to Chicago for a job interview. I have deducted these expenses from my taxes." Keeping up with his industry has paid off. Mr. Graves is now the vice president of global diversity for Delta Airlines' in-flight service.

Do you have to buy new clothes for your new job? The costs for buying the clothes, as well as their upkeep, including dry-cleaning, may be deductible if the new employer requires a uniform and the clothing can't be adaptable for general use.

When you find a new position, your moving expenses that haven't been reimbursed also may be deductible. This may include packing costs, mileage expenses, parking fees and tolls, utility-connection charges and lodging bills while traveling to your new home.

"To qualify, your new job must be at least 50 miles farther from your old home than your new one," says Mr. Horn. "You must be working full time, which means 39 weeks in the first 12 months after arrival. Self-employed individuals must also work at least 78 weeks in the first 24 months after arrival. These expenses are deductible whether or not you itemize your deductions."

The most common mistake job seekers make is failing to keep good records. "I tell my clients to list all expenses that they otherwise wouldn't have incurred had it not been for the job transition, and then let me help determine what's deductible," Mr. Horn says.

If you decide to do consulting from your home while you look for a new job, you may be able to deduct the costs of running a home-based business. These might include home-office expenses such as your phone, a portion of utilities, office supplies and Internet connections. You also may be able to deduct a portion of your auto expenses and self-employment health insurance. "Most expenses relating to consulting are tax deductible," Mr. Horn says.

Unlike the costs associated with a job search, the 2% threshold doesn't apply to your home-business deductions. "If the expense can be allocated to your consulting business, then doing so will offset the consulting income and reduce self-employment tax," he says. "This is better than trying to deduct the expense as a miscellaneous itemized deduction that doesn't reduce self-employment tax and is subject to the 2% of [adjusted gross income] floor." Many professionals fail to allocate expenses properly against consulting income and pay higher self-employment taxes as a result, he adds.

If you're considering going back to school before taking a new job, some education expenses may be deductible under a new above-the-line deduction. If your modified AGI is less than $65,000 ($130,000 for joint filers), you may be able to deduct up to $3,000 of tuition and fees for you, your spouse and dependents. There are limitations and restrictions, so read the Form 1040 instructions carefully.

A self-employed individual may be able to deduct even more qualified educational expenses against his or her income if the education is needed to improve skills to remain in the same occupation.

If you no longer have the benefit of a company's 401(k) plan to save, there are simple ways that you can continue to save and minimize taxes.

Don't succumb to the temptation to liquidate your retirement-plan assets for current income or you may be subject to a 10% tax penalty on top of income taxes.

Some company plans require you to roll your funds out of its plan when you leave the company if your assets are below a certain minimum, usually $5,000. If so, you may want to consider rolling them into an I.R.A.

If you have eligible employer stock in your plan, there's a clever technique that generally allows you to draw the stock out of the plan at the price at which it was originally contributed. For example, you take a lump-sum distribution from your retirement plan that includes your former company's stock that was contributed by the company. You can take that stock without rolling it over into an Individual Retirement Account and not pay any income tax or penalty on any appreciation it had while it was in the plan. The benefit: your assets are then subject to the lower capital-gains tax rate instead of ordinary income tax rates. Plus, you have complete control over the assets and you can sell them or otherwise use them without early I.R.A. withdrawal penalties.

If you're self-employed, simplified employee pensions (SEP) are a great way to save and reduce current income for the year. Contributions are generally deductible from income to the extent that they don't exceed 25% of adjusted earned income, subject to certain limitations. If you didn't qualify for a company-sponsored retirement plan or aren't eligible to do a SEP plan, you may be able to fund your own I.R.A. up to $3,500 a year.

Don't forget about Roth IRAs, the retirement accounts that enable permanently tax-free growth. Besides the availability of making nondeductible contributions to the plan, you may want to consider converting your traditional IRA to a Roth if your income is atypically down in a jobless year. You will have to pay tax on the amount converted, but the subsequent savings on the tax-free appreciation may be worth it.

If you own stock options in your former company, you usually have up to 90 days after leaving to exercise the options before they disappear. The details should be laid out in your options agreement or severance package. Consider the tax impact before exercising your options. The impact will depend on the types of options you own. There are two types: nonqualified and qualified. They differ in how they're treated for tax purposes.

Exercising nonqualified options creates ordinary income in the current year. Qualified options, also known as incentive stock options, aren't taxed at ordinary income rates in the year you exercise them but may be subject to alternative minimum taxes. When you do your taxes, you'll need to calculate both your ordinary income tax and your alternative minimum tax and pay the greater of the two. As long as stock obtained from exercising your incentive options is held for a year after you exercise them (and two years after you receive the grant), the subsequent sale of that stock will be subject to the lower capital-gains rates. If it's sold prior to the one-year anniversary of the exercise, the gain will be taxed as ordinary income. Obviously, there's a cost to exercising shares. Also consider your view of the company's future and your current income before making your decision.

As with many aspects of financial planning, it's best to check with a financial consultant or tax professional who understands your situation and is qualified to offer recommendations.