Sunday, January 7, 2018

Masters Degree Expenses Determined Not Deductible

The taxpayer was an uncredentialed speech pathologist who was hired by the school district under a temporary waiver. As a condition of the waiver, she was required to complete her master's degree within seven years to be qualified as a medical speech pathologist. The taxpayer enrolled in a master's degree program and claimed deductions for her tuition, books, and supplies as unreimbursed employee business expenses that were disallowed by the IRS. The Tax Court agreed, concluding that the expenses were not deductible because they qualified the taxpayer to meet the minimum education requirement for employment and also qualified her for a new trade or business. Under IRC Sec. 162(a) , education expenses are deductible by the taxpayer when incurred to maintain or improve skills required in business or employment, or to meet the requirements of the employer or the law. However, they are not deductible if incurred to meet the minimum requirements for the taxpayer's present employment. Mary A. Colliver, TC Summ. Op. 2017-93 (Tax Ct.)

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