HOUSTON — The Internal Revenue Service is advising teachers and other educators to save their receipts for purchases of books and other classroom supplies. They will be able to deduct up to $250 of such expenses again this year, following recently-enacted legislation.
The Emergency Economic Stabilization Act (EESA) of 2008 reinstated the educator expense deduction, which had expired at the end of last year. The deduction has been reinstated for tax years 2008 and 2009. Expenses incurred any time during 2008 may qualify for the deduction, not just those since the Act was signed on October 3.
“Many teachers dip into their own pockets for classroom supplies,” said Lea Crusberg, IRS Spokesperson. “The reinstatement of this deduction gives educators a tax break this year and next year, and we want them to have the records they’ll need to claim it on their returns.”
The deduction is available to eligible educators in public or private elementary or secondary schools. To be eligible, a person must work at least 900 hours during a school year as a teacher, instructor, counselor, principal or aide.
An educator may subtract up to $250 of qualified out-of-pocket expenses when figuring adjusted gross income (AGI). This deduction is available whether or not the taxpayer itemizes deductions on Schedule A.
Qualified expenses are non-reimbursed expenses paid or incurred for books, supplies, computer equipment including related software and services, other equipment, and supplementary materials that are used in the classroom.
The IRS suggests that educators keep records of qualifying expenses in a folder or envelope with a label such as “Educator Expense Deduction,” noting the date, amount and purpose of each purchase. This will help prevent a missed deduction at tax time.