WASHINGTON — As teachers,
administrators and aides have launched into their fall semester, taxes
may not be on the top of their list. However, knowing what to keep track
of now can help reduce the burden at tax time. The Internal Revenue
Service reminds educators that there are three key work-related tax
benefits that may help them reduce what they pay in taxes.
Educators can take
advantage of tax deductions for qualified expenses related to their
profession. The costs many educators incur out-of-pocket include items
such as classroom supplies, training and travel.
There are two methods educators can choose for deducting qualified
expenses: Claiming the Educator Expense Deduction (up to $250) or, for
those who itemize their deductions, claiming eligible work-related
expenses as a miscellaneous deduction on Schedule A.
A third key benefit enables many teachers and other educators to take advantage of various education tax benefits for their ongoing educational pursuits, especially the Lifetime Learning Credit or, in some instances depending on their circumstances, the American Opportunity Tax Credit.
Educator Expense Deduction
Educators can deduct up to
$250 ($500 if married filing jointly and both spouses are eligible
educators, but not more than $250 each) of unreimbursed business
expenses. The educator expense deduction, claimed on either Form 1040
Line 23 or Form 1040A Line 16, is available even if an educator doesn’t
itemize their deductions. To do so, the taxpayer must be a kindergarten
through grade 12 teacher, instructor, counselor, principal or aide for
at least 900 hours a school year in a school that provides elementary or
secondary education as determined under state law.
Those who qualify can
deduct costs like books, supplies, computer equipment and software,
classroom equipment and supplementary materials used in the classroom.
Expenses for participation in professional development courses are also
deductible. Athletic supplies qualify if used for courses in health or
physical education.
Itemizing Deductions (Using Schedule A)
Often educators have
qualifying classroom and professional development expenses that exceed
the $250 limit. In that case, the IRS encourages them to claim these
excess expenses as a miscellaneous deduction on Schedule A (Form 1040 or
Form 1040NR). In addition, educators can claim other work-related
expenses, such as the cost of subscriptions to professional journals,
professional licenses and union dues. Transportation expenses may also
be deductible in situations such as, for example, where an educator
assigned to teach at two different schools needs to drive from one
school to the other on the same day.
Miscellaneous deductions
of this kind are subject to a two-percent limit. This means that a
taxpayer must subtract two percent of their adjusted gross income from
the total qualifying miscellaneous deduction amount. For more
information, see Publication 529, Miscellaneous Deductions, available on IRS.gov.
Keeping Records
Educators should keep
detailed records of qualifying expenses noting the date, amount and
purpose of each purchase. This will help prevent a missed deduction at
tax time.
Taxpayers should also keep a copy of their tax return
for at least three years. Copies of tax returns may be needed for many
reasons. If applying for college financial aid, a tax transcript may be
all that is needed. A tax transcript summarizes return information and
includes adjusted gross income. Get one from the IRS for free.
The quickest way to get a copy of a tax transcript is to use the Get Transcript
application. After verifying identity, taxpayers can view and print
their transcript immediately online. The online application includes a robust identity verification process.
Those who can’t pass the verification must request the transcript be
mailed. This takes five to 10 days, so plan ahead and request the
transcript early.
Additional IRS Resources:
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