As a former student and now a parent of school-aged children, I realize that being a teacher is truly a thankless job. Most of your day is spent trying to teach and inspire students who would rather be anywhere but stuck inside a classroom. This is not an easy gig. I imagine that sometimes it must feel like a comedian doing standup to a room filled only with Vladimir Putin, Fidel Castro, and Genghis Khan.
When our children excel in school, we always assume it’s due to their unbelievable upbringing and give ourselves a pat on the back. However, when they don’t understand something or fall behind, guess who is always the first one blamed? That’s right, it’s the teacher. Either the teacher was too boring, too strict, too lenient, or talks too fast. No matter what, the teacher cannot win. The teachers in this country, who comprise 2% of the nation’s population, can really use some love, and that’s where the IRS steps in. After all, who needs an apple on their desk when they can have tax incentives instead?
Classroom Supplies Deduction: On December 18, Congress passed the Tax Increase Prevention Act of 2014, which temporarily and retroactively extended 54 tax breaks that expired on December 31, 2013. One of these was the Educator Expense Deduction. This deduction applies whether you itemize your deductions or not. Teachers inevitably spend some of their own money on job-related expenses, whether its books, pencils, crayons, computer equipment, or software. The IRS realizes this can be a financial burden for teachers and they also realize that most teachers are not overheard saying, “I am ridiculously overpaid with this teaching salary.” The Educator Expense Deduction allows teachers to claim up to $250 for these classroom expenses.
Continuing Education Tax Credit: Even teachers need to go to class sometimes. Teachers and educators may qualify for a tax break for unreimbursed courses taken to improve education-related skills. There are various methods of getting this tax break and your accountant should calculate which is the most advantageous for you. There is a tax credit, known as the Lifetime Learning Credit, which credits you for 20% of the cost of the courses taken up to $2,000 per year. While a tax credit is almost always the better route than a deduction because a credit reduces your tax liability dollar for dollar, this credit is non-refundable, so you must have a liability for the credit to go against. Another way is the Tuition and Fees Deduction, which allows you to deduct up to $4,000 a year for courses. You should note that if the education is part of your state school board’s certification renewal process, it may be deductible. However, if the education is needed to meet the minimum educational requirements to qualify you for a particular position, or if the education will qualify you for a new trade or business, it is not deductible.
Teacher Union Dues and Professional Associations: Teachers who pay union dues are eligible to deduct these fees, whether they were paid out of pocket or deducted from a paycheck. This also applies to dues for other professional associations or subscriptions to job-related publications.
Travel Expenses: Travel from home to your place of employment is generally not deductible. However, unreimbursed travel to conferences, seminars, conventions, training, or other school-sanctioned events is tax-deductible teacher expenses. In addition, if you teach at more than one school, then travel expenses between the two schools are deductible.
Daniel Magence, CPA, Esq. is a principal at Pristine CPA Solutions, LLC (www.pristinecpa.com). Pristine CPA Solutions offers tax and accounting services to individuals and businesses of all sizes. He can be reached at [email protected] or 201-326-6908 if you have any questions or comments.
By Daniel Magence, CPA, Esq.
