Tax Tip for Teachers

May 28, 2006

The 2003 Tax Act included a $250 deduction for teachers who spend their own money for classroom supplies.  Most teachers spend far more than $250, so this tax deduction was a very minor victory for teachers.

However, there is a way for teachers to get a full tax deduction for the supplies they purchase for the classroom.  IRS Code Sec. 170(c)(1) states that governmental bodies, including public schools, are considered qualified charitable organizations, which means that donations of cash or supplies to public schools are tax deductible as a charitable donation.

Therefore, teacher’s should deduct the first $250 of supplies on line 23, Educator Expenses (2005 Form 1040), and classroom supplies over the $250 Educator Expenses should be deducted as a non-cash charitable donation on Schedule A, Itemized Deductions.  You’ll need to document your purchases and get written acknowledgment from the school for supplies purchased/donated over $250, but the extra tax savings you’ll receive are worth the effort.

 

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