E3only

Hi guys,

I have a couple of quick question regarding tax deductions.

1. Self education expenses. I am currently working in the Finance field and converting my CPA
2. Donations.

Can I ask if either or both of these can be claimed as deduction? I get confused with the term 'itemized' vs. 'standard deduction'.

For the self education expenses, I read up publication 970 but I wanted to understand more.

We will be filing jointly (wife does not work) and we do not own a home yet. All I want to know is either or both of the above are deductible. e.g. say year income 75k and self expenses ~$750 and $200 donations.

Thanks in advance!

Poppy girl

Room-mate a CPA will get the answer for you as soon as I can get hold of her!!

Michael

You can file either using the standard deduction ($11,400 for married filing jointly) or itemize deductions. Therefore unless you have more than $11,400 in deductions (state income tax, property taxes, mortgage interest, personal property taxes, donations, and other deductions), it is not worth itemizing deductions.

If you have expenses from a business, those are taken on a different form and are taken immediately.

Look at this form to determine what are deductions.

http://www.irs.gov/pub/irs-pdf/f1040sa.pdf

Poppy girl

You beat me to it Thanks thats 3 this past few days

Poppy girl

In order to take advantage of itemized items you have to have over $5,700.
If married $11,400.

E3only

Ok so donations and self education expenses fall within the 'itemized deductions'. I will claim 11700 coz my expenses will never reach that limit.

So that means - my education expenses and donations won't get me deductions.

Poppy girl

Correct on donations
Education would depend on few things possibley!! but as you are not a full time student unlikely

(LOL Yes being expressed these answers by roomie

E3only

)

No, not a full time student but it's painful to know the expenses are out of pocket

Poppy girl

But if its personal you can't if its for your job you can.
It goes under un-reimbursed business expenses if for job.

E3only

Explain that to me?

I am converting my CPAs so technically it's for my job. Unfortunately with budget issues, my job won't reimburse it.

Poppy girl

In the event of a Adit you would have to be prepared to agrue this if it came to that.......she says she would probably right it off thats her personal opinion what you choose to do is up to you!!

It boils down to if the company are requesting you do this or it is of your own free will and time.

Hope this explains.

E3only

Ok how about this the job that I applied for read "Bachelors with CPA/MBA preferred"

Either way, I am converting them given I am in accounting/finance. In a way, it gives me an edge over others if you will in terms of marketability ..

I am definitely not doing it coz I have too much time on hand!! I work 14 hours a day 5 days a week + some weekend work!!

Poppy girl

Bottom line it won't kick it off the tax return, but they will probably question if you get an audit....makes no odds what the study is for in your case CPA/MBA preferred.

Michael

Not quite. There are complex rules determining if educational expenses are deductable. If I remember correctly, if the educational expense is required to keep your current job, it is not deductable but if it is just to enhance you knowledge, it is deductable.

However, the deduction is on Schedule A under unreimbursed business expense and that category has a 2% exclusion of income before the expense will count towards a deduction.

I believe Poppy Girl is self-employed and files Schedule C and on that, she probably deducts just about everything imaginable.

E3only

I need english language lessons...