Classroom teacher in one subject (such as mathematics) to classroom teacher in another subject (such as science).Elementary to secondary school classroom teacher.The regulations then go on to illustrate the application of this rule specifically to teachers, providing that all teaching and related duties are considered to involve the same general type of work, and establishing that the following change in a teacher's duties after an education will not cause those tuition expenses to be treated as having qualified the teacher for a new trade or business: They state that an employee may experience a change of duties after receiving an education without that change of duties constituting a new trade or business if the new duties involve the same general type of work as is involved in the individual's present employment. The regulations provide little clarification. While there are four tests listed above, the overwhelming reality is that the majority of the court decisions focus on the final one: if an education prepares or qualifies a taxpayer for a new trade or business, no deduction is permitted. The graduate courses taken by D constitute education required to meet the minimum educational requirements for qualification in D's trade or business and, thus, the expenditures for such courses are not deductible. D may become a faculty member only if he obtains a graduate degree and may continue to hold a position as instructor only so long as he shows satisfactory progress towards obtaining his graduate degree. The denial of a deduction for education expenses that allow a taxpayer to meet the minimum requirements of a position can be illustrated as follows:ĭ, who holds a bachelor's degree, obtains temporary employment as an instructor at University Y and undertakes graduate courses as a candidate for a graduate degree. Is required in order to meet the minimum requirements of an existing position, ORĤ. Prepares you for a new trade or business. Improves or maintains the taxpayer's skills in his employment or trade or business.Ĭategory #2: Expenses that CANNOT be deductedģ. Meets the express requirements of the individual's employer imposed as a condition necessary for the individual to remain employed, ORĢ. Regulation 1.162-5, which governs the deductibility of educational expenses, can be neatly broken up into two categories, and further into two good tests, and two bad tests:Ĭategory #1: Expenses that CAN be deductedġ. Even with his generosity, however, I emerged from school deep in debt, owing largely to living expenses and the Bengals stubborn refusal to simply cover that damn +3 1/2. I was fortunate I had a benefactor in the form of the program's director, who recognized my commitment to learning the law and offered to pay for my tuition. The only downside to bailing on the real world and returning to the classroom, of course, is the cost. Make no mistake, I'd loved college the first time around but on my second go-round it was far sweeter than even I'd remembered it. It was as if the days had suddenly doubled in length I had four hours of class on Monday and Wednesday nights, leaving 160 hours each week for studying, boozing, and desperately imploring the Bengals to cover +3 1/2. And I savored every minute of it. When I was 26, I took a break from cranking out 60-hour work weeks at PwC to pursue a Masters degree in taxation full-time, with the hopes that I would build enough expertise to allow me to someday combine Code sections and Simpsons references on the pages of.
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