Educator Expenses

If you are an eligible qualified educator, you may be able to deduct up to $250 of expenses you paid for purchases of books and classroom supplies “above-the-line” on your 2006 1040 tax return. These out-of-pocket expenses may lower your 2006 tax bill even if you don’t itemize your deductions. To qualify you must meet the following two rules:

• Be an Eligible Educator: The deduction is available if you are an eligible educator in a public or private elementary or secondary school. To be eligible, you must work at least 900 hours during a school year as a K-12 teacher, instructor, counselor, principal or aide.

• Qualifying Expenses: You may subtract up to $250 of qualified expenses when figuring your adjusted gross income. Expenses are qualified when they are un-reimbursed expenses you paid or incurred for books, supplies, computer equipment, software, computer services, and supplementary materials that you use in the classroom. For courses in health and physical education, expenses for supplies are qualified expenses only if they are related to athletics.

Note: Your 2006 tax forms were printed before this deduction was extended, so use line 23 of your Form 1040 to claim this deduction and write an "E" next to the line or enter “B” if claiming both an Archer MSA deduction and the deduction for educator expenses.

For more information about this topic, visit the IRS Web site at www.IRS.gov