Education Expenses

Expenses for education are deductible even if the education leads to a degree, if it meets at least one of the following tests.

1)  The education maintains or improves skills required for the taxpayer’s present work.

2)  The education is required by the taxpayer’s employer or by law.

Exception: Education is not deductible, even though one or both of the above tests are met, if the education:

1)  Is needed to meet the minimum educational requirements to qualify for the taxpayer’s line of work, or

Seal of the United States Department of Education (Photo credit: Wikipedia)

2)  Will lead the taxpayer to qualify for a new line of work. This is true even if the taxpayer does not intend to enter that line of work.

Education Required By Employer or By Law

Once minimum educational requirements are met for a job, an employer or the law may require additional education. This additional education is deductible if all the following requirements are met.

•   It is required to keep the taxpayer’s present salary, status, or job.

•    The requirement serves a business purpose of the employer.

•    The education is not part of a program that will qualify the taxpayer for a new trade or business.

If a taxpayer receives more education than required by an employer or by law, the additional education can qualify as work-related education only if it maintains or improves skills required for a taxpayer’s present line of work. This could include refresher courses, courses on current developments, and academic or vocational courses.