You’ll Have to Show The IRS the Money
Since 2004, eligible educators have been able to deduct up to $250 worth of school supplies they purchased with their own money. Congress has renewed this tax break for 2006 but not in time for the printing of 2006 tax forms and instruction booklets. There are no lines on the 2006 tax form to record the deduction.
The IRS has posted instructions on its Web site (www.irs.com) for how to file the deduction for paper returns. If you file your taxes electronically, software programs are supposed to be updated.
The rules for taking the deduction remain the same. An “eligible educator” is an employee who works at least 900 hours during a school year in a school that provides elementary or secondary education. That includes teachers, instructors, counselors, principals or aides.
“Qualified expenses” are unreimbursed expenses for books, supplies, computer equipment (including related software and services), other equipment and supplementary supplies that you use in the classroom.
For courses in health and physical education, expenses for supplies are considered “qualified expenses” only if they aren’t related to athletics.
Also back for 2006 and 2007 is the deduction for higher education tuition and fees. Check with your tax preparer or with the IRS to see if you’re eligible.