Click here for the article of The New York Times, 20 January 2009.
The Wall Street Journal reported last week about a Maryland nurse who won a long battle with the I.R.S. when the United States Tax Court said she had properly deducted nearly $15,000 for the cost of her master’s degree in business. The article described how the I.R.S.’s rules for deducting work-related tuition were “complicated and onerous” and said the decision “clarifies the rules and will likely lead to more taxpayers taking the deduction.”
But the article neglected to describe how the decision clarified the rules. So I did a little digging to find out.
According to the tax experts I spoke with, under I.R.S. rules, employees can deduct ordinary and necessary expenses they pay in connection with their trade or business that are appropriate or helpful to the business. Taxpayers can deduct education costs, in particular, as “ordinary and necessary” expenses if the education maintains or improves the skills required for the taxpayer’s current trade or business. If not, the expenses are considered personal…
Read the full article: When You Can Deduct the Cost of Your M.B.A. (New York Times)
