One of several tax breaks extended by Congress last minute Fiscal Cliff activity on New Year’s Day is the Educator Expense Deduction. While most education tax breaks benefit those who pay to learn, the Educator Expense Deduction is for those who teach.
How Much is the Educator Expense Deduction?
The maximum Educator Expense Deduction is $250 per individual. In the event both spouses are educators and each spends at least $250 on qualified educator expenses, the maximum deduction on their joint return is $500.
What Expenses Qualify for the Educator Expense Deduction?
The IRS has determined that the following expenses qualify for the deduction:
- computer equipment (including related software and services)
- other equipment, and
- supplementary materials that you use in the classroom
Keep in mind that health and physical education teachers who incur educator expenses must use them in athletic education to qualify for the deduction. In addition, all expenses must be unreimbursed to be deductible (If you’re not out-of-pocket due to the expenditure, you didn’t really incur the expense).
Who Qualifies for the Educator Expense Deduction?
Not surprisingly, you must be an educator to be able to take the deduction. This means you can be a teacher, instructor, an aid, or pretty much anyone who spends 900 hours or more per year in a elementary or secondary school. Principals qualify too, but home school educators do not.
In addition, you must file either file a Form 1040 or a Form 1040A to deduct your educator expenses. While some tax deductions require taxpayers to itemize in order to benefit, the Educator Expense Deduction does not. As a result, every taxpayer with the bona fide educator expenses described above will save money on their taxes.
TurboTax walks you through the appropriate tax questions to make sure you get this tax deduction if you’re eligible, so you can keep more of your hard-earned money. If you still have questions, only TurboTax lets you talk to CPAs, IRS enrolled agents, or tax attorneys while you prepare your taxes, free.