Teacher Taxes: How Does The Educator Expense Tax Deduction Work?

Are you a teacher getting ready to file 2020 taxes? The average teacher spends nearly $500 of their personal money each year on classroom supplies, which means you are likely eligible for the educator expenses tax deduction. 


First off, we want to explain that this is not a true deduction, but an income adjustment. You may have even heard it called an “above the line” deduction. This adjustment is included on Form 1040, Line 10a and will reduce your adjusted gross income, or AGI, which is the total income amount that you will be taxed on. If you’re looking for an easy solution to filling out tax forms this season, consider the IOOGO Tax DIY, where you can file in 15 minutes or less. 


What is the educator expense tax deduction? 

The educator expense tax is a tax credit that can be used if you spent your own money on supplies for your classroom in 2020. Each individual can claim up to $250 each, including $500 per household if there are two qualifying educators. 


What qualifies under the educator expense tax deduction?   

Classroom expenses looked a little different in 2020, which means you may have more flexibility on what types of supplies can be claimed. The IRS outlines the types of materials that would qualify you for the deduction which includes, books, supplies, computers, software,  teaching equipment and professional development courses. If you purchased health or physical activity related expenses, these items must be used for athletics. 


How to know if you qualify  for the educator expense tax deduction 

In addition to the type of supplies purchased, you must also qualify based on specific educator rules. 

  • You must be a teacher, instructor, counselor, principal or aide for kindergarten through grade 12. 
  • You must have completed 900 hours of work in a facility determined by a school by state law. 


Are there any disqualifying factors to be aware of? 

If you are filing for the educator expense tax deduction and you used funding from your Coverdell education savings accounts or a state tuition program to cover professional development fees or other supplies, these items cannot be included as a part of the tax deduction. The same goes for any interest earned on Series EE or from U.S savings bonds that you have deducted from your taxable income. Your teaching expenses will need to exceed the amount of interest earned and claimed. As a reminder, it’s important to keep your receipts in case you ever get audited. 


How do I file for the educator expense tax deduction? 

To file for the educator expense tax deduction, even if you are not claiming the full $250, you will need to fill out Form 1040, Form 1040-SR, or Form 1040-NR (attach Schedule 1 (Form 1040) PDF).


If you’re ready to file your taxes or need help preparing them, sign-up for our IOOGO Tax DIY software or IOOGO Tax Pro.  

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