E is for Educator Expenses.
Every Friday, I volunteer in my son’s kindergarten class. I am constantly amazed at how much money his teacher spends – out of her own pocket – to buy treats, prizes, awards, snacks, and crafts for her students. Last Friday, she bought Dr. Seuss paper hats, put together activity books, and helped the kids make truffula tree bookmarks – all in honor of Dr. Seuss’ birthday (it was the inspiration for my Seussical tax poem). I can’t imagine how much it costs her. And yet, she does it year after year because she loves her job and she loves her kids.
Unlike much of corporate America, most teachers don’t have the luxury of submitting reimbursement requests and expense reports. When they spend, they know it’s money they won’t see again.
Fortunately, the IRS offers teachers and other eligible educators a little bit of a break. Under the rules, if you are an eligible educator, you can deduct up to $250 of any unreimbursed expenses paid or incurred for books, supplies, computer equipment, other equipment, and supplementary materials used in the classroom; these expenses must be paid or incurred during the tax year. If your spouse has qualified out of pocket educator expenses and you file jointly, you can claim up to $500.
As with alimony, this is an above-the-line deduction, meaning that you can take the deduction even if you do not itemize. It’s found at line 23 of your federal form 1040 (or line 16 of your federal form 1040A).
Of course, if you itemize, you can also claim job-related expenses above the $250 limit on a Schedule A, subject to the 2% rule (the 2% rule means that you can only deduct expenses which are in excess of 2% of your adjusted gross income). But no double-dipping – you can’t claim the same expense at both places. The same rules for record-keeping apply to educator expenses as with most deductions so keep excellent receipts.
Eligible educators are defined as teachers, instructors, counselors, principals, and aides for kindergarten through grade 12. To be eligible, you must work at least 900 hours a school year in a school that provides elementary or secondary education, as determined under state law.
The rules, as written, appear to prohibit parents who homeschool from taking the deduction. I’ve heard some homeschooling parents argue the point but, quite frankly, for a $250 deduction, I wouldn’t be willing to risk it.
One more detail: the tax break is available for the tax year 2011 (the return you’re working on now) but is not currently available for 2012. It was extended (again and again) as part of various extender bills but it didn’t make the cut for 2012. That may change: it’s one of a number of tax breaks under consideration for an extension by Congress.
Note: The TCJA made changes to many tax deductions previously available on Schedule A, including miscellaneous deductions that exceed 2% of your adjusted gross income (“AGI”). This is applicable for the years 2018-2025.
