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Wilmington NC CPA discusses re-institution of the Educator Expense Deduction on Tax Form 1040

Tax Accounting Firm in Wilmington NC

Gary Bode, CPA: If you'd like a free initial consult with a Wilmington NC tax accountant, please consider calling us at (910) 399-2705.

Congress rescinded the Educator Expense Deduction in 2010, then re-instituted it on December 17th!  So, the IRS must update their tax forms, making teachers wait until mid to late February to file Form 1040.  Strange, but true.  The IRS also recommends that teachers E-File to avoid confusion.

As a Wilmington NC CPA, with teachers in the family, I know educators personally provide supplies for their classrooms—even paper and pencils.  Up to $250 of qualified expenses can be deducted on line 16 of tax Form 1040, as an adjustment to Gross Income.  What is the actual tax savings to teachers for the $250 deduction?  It depends on the teacher’s marginal tax rate; in most cases it is probably $62-$75.  This is certainly just a fraction of what teachers actually provide over the year!  But it is token recognition of a deplorable condition and how teachers come through for their students under adverse circumstances. 

We’re a Wilmington NC accounting firm offering a free initial consult with a CPA specializing in tax preparation.  Please consider calling us at (910) 399-2705.

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