Five Things to Know About the $250 Tax Break That Teachers Could Lose

By Liana Loewus for edweek.com

When it comes time to do their taxes, millions of educators have had the satisfaction of checking a box that saves them some money, and isn’t available to people in other professions. The tax bill proposed by House Republicans would eliminate the $250 deduction teachers can claim for classroom supplies—and educators aren’t taking to it kindly.

We spoke with Internal Revenue Service officials to try to get a handle on what exactly the tax law says and what it means for teachers. Here’s some of what you need to know about the “educator expense deduction.”

1. Who can take the tax deduction? And what can they take it for?

K-12 teachers, principals, counselors, and aides who worked in schools for at least 900 hours a year (or an average of about five hours a school day) can currently take the tax deduction.

They can deduct up to $250 annually for books, supplies, computer hardware and software, and “other supplementary materials” that they purchased for their classrooms and were not reimbursed for by their district. They can also deduct for any out-of-pocket professional-development expenses. Health and physical education teachers can also use the deduction for athletic supplies.

Two educators who are married and filing jointly can deduct up to $500 a year (though no more than $250 a person).

The deduction is somewhat unusual in that it’s “above the line,” meaning teachers don’t have to itemize to get it. It comes directly off of their taxable income.

The only other professions specifically mentioned on the tax form as being entitled to certain above-the-line breaks are National Guard and Reserve members, performing artists, and fee-basis government officials (such as a notary public, who is paid a flat rate for a service rendered).

That said, it’s important to understand that the educator benefit is not a credit, which would reduce how much money a person owes the government (or is owed) dollar-for-dollar. As an IRS spokesman explained, there are some situations where a tax deduction is more advantageous than a credit—in particular when it moves someone into a lower tax bracket.

Read more here.

Teach your child to read with Reading Kingdom.  Sign up today for a free 30 day trial.