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Home > Archive > Certifications and IT jobs/Salaries > February 2002 > claiming certs on income tax
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claiming certs on income tax
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| techdaemon 2002-02-03, 3:32 pm |
| I don't remember where, but I once heard, or read that I could claim my certifications on my income tax. Since I got them this year and they're considered as some form of school in a way.. Does anyone know if any of this is true? Thanx | |
| techdaemon 2002-02-03, 3:59 pm |
| Ok, I just asked my friend and he said that I could claim my certs on my income tax and that it's considered schooling.. he said that I do however need receipts.. I don't remember getting any kind of receipt for my certs, just what would appear on my credit card statement I suppose.. anyone else here get some kind of receipt? | |
| Nicole 2002-02-03, 5:59 pm |
| Guess I'm not the only one doing my taxes this weekend!
Everyone here knows that all those computer books and Self-Test or Transcenders fees are really legitimate expenses to gain a legitimate educational certificate. Unfortunately, the IRS laws don't see it that way, they are designed for the traditional enroll-in-college kind of education.
You CANNOT deduct all those books and test preparation software packages under the Lifetime Learning Credit -- it's just for tuition. If you stretch it, it could cover testing fees. Maybe. (And the very generous Hope Credit is pretty much just for people enrolled in a college programs.) So a certification camp or a program with somebody like Techskills would count, or IT classes you take at a college, but self-study expenses would not.
BUT --
You CAN deduct those costs somewhere else -- but only if you are already working in the industry. Under "Unreimbursed Employee Business Expenses" there's a section for -- you guessed it -- education. This particular deduction includes books, supplies, fees, even some transportation costs, and so forth. It DOES NOT include training for another career, or for meeting the minimum requirements for your current job. It's a deduction to improve your value to your employer -- so it you have any kind of IT job, any study or certification that relates to what you do or would like to do for your employer should count.
I am NOT a tax preparation professional, so don't take my word for it. But if you are looking for a place to put those deductions, it's a good place to start.
Oh yes -- you can't claim both 
(Unreimbursed Employee Business Expenses is also a great place to put conferences you may attend and job search expenses (as long as you are looking for a job in the same line of work.) | |
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| THIS IS THE BEST NON-IT QUESTION OF THE YEAR!
I want to know, too.
Do anyone know a income tax accountant to help us? | |
| ccieToBe 2002-02-03, 11:25 pm |
| I'm not an expert in this sort of thing by any means but my dad is a CPA and I asked him about this a while ago. If I remember correctly he basically said that it would be a stretch to claim certs as a deduction if you're an employee but as a contractor they can be claimed as long as you can show that they helped you in your business (ie helped you get extra clients). Double check for yourself though because it's very possible that I'm remembering incorrectly. | |
| Nicole 2002-02-04, 11:05 am |
| They are too big too attach here, but here are links to the relevant IRS publications:
Publication 970 "Tax Benefits for Higher Education:
http://www.irs.gov/pub/irs-pdf/p970.pdf
quote:
Hope Credit - What Expenses Qualify?
Qualified tuition and related expenses. In general, qualified tuition and related expenses are tuition and fees required for enrollment or attendance at an eligible educational institution.
Student-activity fees and fees for course-related books, supplies, and equipment are included in qualified tuition and related expenses only if the fees must be paid to the institution as a condition of enrollment or attendance.
Lifetime Learning Credit - What Expenses Qualify?
Qualified tuition and related expenses. In general, qualified tuition and related expenses are tuition and fees required for enrollment or attendance at an eligible educational institution (defined earlier).
Student-activity fees and fees for course-related books, supplies, and equipment are included in qualified tuition and related expenses only if the fees must be paid to the institution as a condition of enrollment or attendance.
Publication 529 Miscellaneous Deductions
http://www.irs.gov/pub/irs-pdf/p529.pdf
quote:
You can deduct only unreimbursed employee expenses that are:
1) Paid or incurred during your tax year,
2) For carrying on your trade or business of being an employee, and
3) Ordinary and necessary.
An expense is ordinary if it is common and accepted in your type of trade or business. An expense is necessary if it is appropriate and helpful to your trade or business.
You may be able to deduct the following items as unreimbursed employee expenses...
•Education that is work related...
•Tools and supplies used in your work...
...
You can deduct expenses you have for education, even if the education may lead to a degree, if the education meets at least one of the following two tests.
1) It maintains or improves skills required in your present work.
2) It is required by your employer or the law to keep your salary, status, or job, and the requirement serves a business purpose of your employer.
If your education meets either of these tests, you can deduct expenses for tuition, books, supplies, laboratory fees, and similar items, and certain transportation costs...
You cannot deduct expenses you have for education, even though one or both of the preceding tests are met, if the education:
1) Is needed to meet the minimum educational requirements to qualify you in your work or business, or
2) Will lead to qualifying you in a new trade or business.
If the education qualifies you for a new trade or business, you cannot deduct the educational expenses even if you do not intend to enter that trade or business.
Publication 508 Tax Benefits for Work Related Education
http://www.irs.gov/pub/irs-pdf/p508.pdf
Just read this one... it's only 11 pages But it has details on qualifying expenses. | |
| cassie 2002-02-12, 6:30 am |
| Boy, this is an interesting thread!
Does anyone know of definitive guidelines for this sort of thing for the UK? (Sorry if I'm the only non-US poster on the thread!!)
I think that you can claim books, certs, training if you are self-employed, but that if you are an employee then it would be hard to justify as only costs that are absolutely necessary for your job are allowed.
Cassie | |
| techdaemon 2002-02-12, 9:19 am |
| Ok, I don't know if anyone is still reading this thread, but I claimed my certs and some study material (books) on my income tax, and I'm getting a pretty good return, so I think it can be done.. One more week and I'll see if I actually get what I claimed.. The accountant I took it to though, said that it was possible however.. | |
| RichardJW 2002-02-24, 11:59 am |
| You can deduct the costs of items important to your company/profession from your total income under the new scheme of capital allowances in the UK and provided that you are self-employed. In no circumstances are you liable for a refund.
It's a really strange thing when you walk into an Inland Revenue advice bureau, there's never a queue. | |
| timmyq45 2002-02-25, 1:47 am |
| I am a contractor I teach MCSE and other stuff and I am writing off everything, based on the claim that I was improving my business, which is my teaching credentials. I also made too much income based on last years rules to use the other education options, plus it offsets any income. |
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