It’s a holiday week, so I’m re-publishing popular blog posts from the past. Just like Monday’s “From the Archives,” this one from last September is about college professors and their work-related expenses.
Originally published September 26, 2016
College professors may be entitled to certain deductions on their tax returns for classroom books and supplies, and books and other materials which further their academic research.
But what about maintaining books and other materials for “general knowledge”?
A recent case before the U.S. Tax Court gives us the answer.
A married couple in Florida both work for a college in Florida; he’s a math and communications professor, she’s the campus librarian.
In 2011, they filed a joint tax return showing more than $10,000 of deductions for books purchased for their personal library in their home, cell phone expenses, internet expenses, satellite TV expenses, computer expenses, and depreciation deductions for various big-ticket asset purchases made between 2004 and 2008.
The IRS disallowed the deductions, and the couple appealed to the U.S. Tax Court.
In Court arguments, the couple argued that they are required to be lifelong learners, and therefore the expenses should be deductible. The husband, a “Dr. Tanzi,” made the following argument to the Court:
(I)ndividuals holding such terminal degrees bear a lifelong burden of “developing knowledge, finding knowledge, exploring, [and] essentially self-educating”. Dr. Tanzi therefore insists that all expenses paid in adding to his “general knowledge” should be deductible….
The Tax Court sided with the IRS. In rejecting the couple’s argument, the Court said:
“The expenses were not ordinary and necessary to the Tanzis’ trades but were rather in the nature of personal expenses. None of the expenses were a condition of their employment. Dr. Tanzi even admitted that he is aware of no university that requires professors to purchase these additional materials and services in carrying out their jobs. Accordingly, the Tanzis are not entitled to deduct satellite television expenses or the costs of maintaining their professional library.”
The Court went on to say:
“While we find credible the Tanzis’ testimony that they spent significant time and resources educating themselves, we do not believe the expenses are ordinary and necessary for the trades of being a professor or a campus librarian but rather are personal, living, or family expenses (that are) nondeductible….”
What This Means
The problem for the couple in this case was, they couldn’t tie any of their deductions to actual work-related endeavors. Simply saying “pursuit of general knowledge” isn’t enough to have a deductible expense.
As a college professor, you can deduct the following:
- Any materials, books, etc. purchased in the pursuit of research in your field
- Any materials, books, etc. purchased for use in the classroom
- The business-related percentage of cell phone bills (for example, if you can establish you use your phone for work 40% of the time, you can deduct 40% of your bill).
- Membership dues to professional organizations
- Conference registration and associated travel costs for attending conferences in your field
- Work-related expenses that are required as a condition of employment; for example your institution might require you to publish a certain number of articles, or an art professor might be required to produce a certain amount of artwork. Expenses related to meeting these requirements would be deductible.
- Link to the Tax Court Case is here.
- Link to a previous post about whether or not a college professor can claim the $250 deduction for educator expenses
- Link to a previous post about whether or not a college professor can claim a home office deduction on the front side of their Form 1040
“This blog post, along with comments that may follow, should not be considered tax advice. Before you make final tax or financial decisions, please secure a professional tax advisor to give you advice about your unique situation. To secure Jason as your accountant, please click on the ‘Services’ link at the top of the page.”