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Don’t forget that you may still be able to deduct up to $250 of out-of-pocket classroom expenses.
On Dec. 20, 2006, the President extended several provisions originally available under the Working Families Tax Relief Act of 2004, Gulf Opportunity Zone Act of 2005 and American Jobs Creation Act of 2005 by passing H.R. 6111, Tax Relief and Health Care Act of 2006.
Due to the late timing of these changes in the law, Form 1040 was not updated and there is no longer an adjustment line specifically for Educator Expenses as there was in 2005.
For 2006, educators must file Form 1040 in order to take the deduction. It cannot be claimed on Form 1040A as it was in 2005. The deduction for educator expenses can be claimed on Form 1040 line 23, “Archer MSA Deduction.” Enter “E” on the dotted line to the left of that line entry of claiming educator expenses or “B” if claiming both an Archer MSA (Medical Savings Accounts) deduction and the deduction for educator expenses. If entering “B,” taxpayers must attach a breakdown showing the amounts claimed for each deduction.
There are several other provisions that were extended by the Tax Relief and Health Care Act of 2006 that may affect your 2006 tax return. Please consult your Rea & Associates professional to discuss your personal situation.
By Denell R. Skelton, CPA (Manager, New Philadelphia Office)
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