Editor's Note: This article is part of our 2014 Tax Tips series. Robert Flach is an expert with more than 40 years of experience as a tax professional and also blogs as The Wandering Tax Pro.
NEW YORK (MainStreet) In my "Tax Tip "These Are the Most Important Numbers on Your Tax Return," I introduced you to "above the line" deductions, aka "Adjustments to Income," which reduce your Adjusted Gross Income. Let's take a look at some of these deductions.
Teachers, counselors, principals and aides of students in kindergarten through 12th grade, who have worked at least 900 hours during the school year, can deduct up to $250 of unreimbursed out-of-pocket expenses for books, supplies, computer software, equipment, and other classroom materials. If both husband and wife are qualified educators, they each get up to $250. Educators who spend more than $250, as most do, can deduct the excess as an "Employee Business Expense" on Schedule A if their total miscellaneous deductions exceed 2% of Adjusted Gross Income (AGI).
TUITION AND FEES:
Most undergraduate college students get the best tax benefit by claiming the American Opportunity Credit. Graduate students can claim either a Lifetime Learning Credit or the special Tuition and Fees Deduction.
Joint filers with an AGI of $130,000 or less, and single filers with AGI of $65,000 or less, can deduct up to $4,000 in qualifying expenses for tuition and fees and required books, supplies and equipment. The deduction is limited to $2,000 for married couples with an AGI of between $130,001 and $160,000 and singles with AGI between 65,001 and $80,000.
This deduction also expired on December 31, 2013 and has not yet been extended it for 2014 and beyond.