Don't Mess With Taxes

Thank you teachers! It’s something students and their families should say every day, but today especially.

The first full week of May is Teacher Appreciation Week, and Tuesday of that week is designated National Teacher Day. That’s today, May 6, this year.

The National Education Association (NEA) says that the whole week, but notably today’s special designation is a time for honoring teachers and recognizing the lasting contributions they make to our lives.

Adequate funding for schools and better wages for teachers are among the issues championed by the NEA and other education advocacy groups.

While those fiscal decisions generally are decided at local levels, the federal government does play a role, although proposed Trump administration Department of Education cuts will lessen or eliminate them.

However, one small bit of financial assistance from Uncle Sam remains.

The Educator Expense Deduction lets eligible teachers and other school employees deduct up to $300 worth of qualified expenses from their income for the 2024 and 2025 tax years.

Lagging teacher pay: The tax break, which actually is one of 24 income adjustments popularly known as above-the-line deductions, was created to help reimburse educators who use their own money to provide or supplement supplies they use in classrooms.

The financial help is welcome, since teacher pay tends to be less that many other professionals.

Educators’ pay naturally varies from state to state since the cost of living is different across the country.

Accounting for those variables and using 2021–22 school year data, USA Facts reports that compensation for New York and Massachusetts K-12 teachers is greater than the pay for teachers in the rest of the country. Adjusted teacher pay is the lowest in Florida.

Overall, more than a third of states paid teachers an adjusted average of less than $60,000 per year. In 48 states and Washington, D.C., teachers generally earn less than the average salary for other workers with a bachelor’s or master’s degree.

Spending their own money: In many instances, and despite their own financial issues, teachers use their own money to provide classroom supplies.

The federal tax break can help cover some of those qualified unreimbursed classroom expenses that teachers pay out-of-pocket, but likely not all.

A 2023 survey by the Association of American Educators (AAE), a national professional association serving educators nationwide, found that nearly 97 percent teachers polled purchased classroom supplies with their own money.

The average amount the teachers spent on these school supplies was, two years ago, $673 per year. That’s more than double the $300 Educator Expense Deduction.

Further breakouts showed that classroom teachers earning between $35,000 and $50,000 spent $715 on average, and classroom teachers working in school districts with 75 percent or more students eligible for free or reduced price lunch spent $761.

Not surprisingly, nearly 40 percent of teachers reported that the amount of their own money they spent on classroom supplies had increased each year. So, even educators who spend the same amount as last year are likely getting less for it.

That’s why the AAE is calling for the educators expenses write-off to be increased to $1,000 per person. That’s close to the amount of out-of-pocket expenditures reported in other surveys.

But until the deduction amount is increased, eligible teachers and other educations will have to settle for the current $300 tax break. It’s been at that level since its first (and only) inflation adjustment for the 2022 tax year.

Here’s an overview of the educators expenses deduction.

Tax definition of educator: This tax break often is referred to as the teachers' expenses deduction. The Internal Revenue Service, however, uses the broader educator definition of educator.

Eligible educators include anyone who is a kindergarten through grade 12 teacher, instructor, counselor, principal, or aide. These individuals must work for at least 900 hours during the school year in a facility that provides elementary or secondary education as determined under state law.

Both public and private school educators qualify. However, home-school teachers are not eligible to claim the educators' deduction.

Deductible expenses: The usual school items — books, supplies, and other materials used in the classroom — are among the qualifying costs. So are unreimbursed costs of instructional equipment, including computer hardware, software, and services.

Again, the IRS reminds teachers and their eligible colleagues that home schooling costs don't count. Neither do nonathletic supplies for courses in health or physical education.

And if you’re an educator who works to improve your educational skills, the cost of professional development courses is an allowable educators' deduction expense. Just make sure the courses are related to the curriculum or students you teach.

Itemizing not necessary: So, how do you claim your allowable educator expenses? The good news is that it is one of easiest tax breaks to claim.

As noted earlier, the educator expenses claim is an above-the-line deduction that doesn’t require taxpayers to itemize. You can claim it regardless of which deduction method you choose when you file.

The specific educators expense claim is found on line 11 of Form 1040 Schedule 1, as shown on the highlighted excerpt below.

You can find more tax form posts at the ol' blog's special Tax Forms 2024 and Tax Forms 2025 pages.
  

There are no percentages of adjusted gross income to calculate. Just claim your classroom-related costs up $300 and attach Schedule 1 to your Form 1040 when you file.

If you and your spouse are both educators filing a joint return, the limit rises to $600. But note that that the $300 claim applies to each spouse separately.

So, if one teacher spouse spent $400 and the equally educational spouse spent $200, the couple can only claim $500. That's $300 for the bigger spender, $200 for the more frugal husband or wife teacher.

Record keeping recommended: Finally, remember a cardinal tax rule. Good record keeping is always a good idea.

You don’t have to submit your classroom expenses receipts when you claim your out-of-pocket educator expenses, but as with all tax deduction and credit claims, keeping good records of your qualifying purchases will help ensure you get the full amount if the IRS ever has any questions.

This includes receipts, cancelled checks, and other documentation of your eligible purchases up to the $300 maximum claim.

Yes, it’s not that much tax relief relatively speaking. But educators (and all savvy taxpayers) long ago learned the lesson that every tax break helps.

You also might find these items of interest:

• A quick lesson on two educational tax credits
• 7 financial gifts, some with tax benefits, for graduates
• Teachers deserve more than the current paltry tax deduction for classroom costs
• Tax-reducing deductions, credits, and income exclusions get inflation bumps in 2025

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