The Teacher Tax Deduction

Teachers and other educators should save their receipts when buying classroom supplies that are unreimbursed, since they may deduct up to $250 of it on their taxes.

This tax break originally expired at the end of 2004, but was recently renewed. Eligible educators include K-12 teachers, instructors, counselors, principals, and aides. In addition, they need to work at least 900 hours during the school year.

Deduction Eligible Expenses
Eligible expenses include unreimbursed costs for books, computer equipment including software and services, supplies, and other materials used in the classroom. All items must be “ordinary and necessary”, meaning it must be something that is helpful and generally used by educators for teaching.

Married couples that both teach are both eligible for their own separate deduction, each with the $250 limitation. Also, any expenses above $250 can still be deducted (just as before this tax rule) if you use Schedule A to itemize. However, it would be a miscellaneous deduction, which has a 2% AGI limitation.

So hold on to those receipts!
It is suggested that you keep a separate envelope or folder to keep the receipts for these unreimbursed school related expenses.


Categories Financial Planning, Saving Money, Taxes
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