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File Free State Income Tax

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File Free State Income Tax

File free state income tax Part Five -   Standard Deduction and Itemized Deductions After you have figured your adjusted gross income, you are ready to subtract the deductions used to figure taxable income. File free state income tax You can subtract either the standard deduction or itemized deductions. File free state income tax Itemized deductions are deductions for certain expenses that are listed on Schedule A (Form 1040). File free state income tax The ten chapters in this part discuss the standard deduction, each itemized deduction, and a limit on some of your itemized deductions if your adjusted gross income is more than certain amounts. File free state income tax See chapter 20 for the factors to consider when deciding whether to subtract the standard deduction or itemized deductions. File free state income tax Table of Contents 20. File free state income tax   Standard DeductionWhat's New Introduction Standard Deduction Amount Standard Deduction for Dependents Who Should ItemizeWhen to itemize. File free state income tax Married persons who filed separate returns. File free state income tax 21. File free state income tax   Medical and Dental ExpensesWhat's New Introduction Useful Items - You may want to see: What Are Medical Expenses? What Expenses Can You Include This Year?Community property states. File free state income tax How Much of the Expenses Can You Deduct? Whose Medical Expenses Can You Include?Yourself Spouse Dependent Decedent What Medical Expenses Are Includible?Insurance Premiums Meals and Lodging Transportation Disabled Dependent Care Expenses How Do You Treat Reimbursements?Insurance Reimbursement Damages for Personal Injuries How Do You Figure and Report the Deduction on Your Tax Return?What Tax Form Do You Use? Impairment-Related Work Expenses Health Insurance Costs for Self-Employed Persons 22. File free state income tax   TaxesIntroductionIndian tribal government. File free state income tax Useful Items - You may want to see: Tests To Deduct Any Tax Income TaxesState and Local Income Taxes Foreign Income Taxes General Sales TaxesMotor vehicles. File free state income tax Real Estate TaxesReal estate taxes for prior years. File free state income tax Examples. File free state income tax Form 1099-S. File free state income tax Real Estate-Related Items You Cannot Deduct Personal Property Taxes Taxes and Fees You Cannot Deduct Where To Deduct 23. File free state income tax   Interest ExpenseIntroduction Useful Items - You may want to see: Home Mortgage InterestAmount Deductible Points Mortgage Insurance Premiums Form 1098, Mortgage Interest Statement Investment InterestInvestment Property Allocation of Interest Expense Limit on Deduction Items You Cannot DeductPersonal Interest Allocation of Interest How To ReportMore than one borrower. File free state income tax Mortgage proceeds used for business or investment. File free state income tax 24. File free state income tax   ContributionsIntroduction Useful Items - You may want to see: Organizations That Qualify To Receive Deductible ContributionsTypes of Qualified Organizations Contributions You Can DeductContributions From Which You Benefit Expenses Paid for Student Living With You Out-of-Pocket Expenses in Giving Services Contributions You Cannot DeductContributions to Individuals Contributions to Nonqualified Organizations Contributions From Which You Benefit Value of Time or Services Personal Expenses Appraisal Fees Contributions of PropertyException. File free state income tax Household items. File free state income tax Deduction more than $500. File free state income tax Form 1098-C. File free state income tax Filing deadline approaching and still no Form 1098-C. File free state income tax Exception 1—vehicle used or improved by organization. File free state income tax Exception 2—vehicle given or sold to needy individual. File free state income tax Deduction $500 or less. File free state income tax Right to use property. File free state income tax Tangible personal property. File free state income tax Future interest. File free state income tax Determining Fair Market Value Giving Property That Has Decreased in Value Giving Property That Has Increased in Value When To DeductChecks. File free state income tax Text message. File free state income tax Credit card. File free state income tax Pay-by-phone account. File free state income tax Stock certificate. File free state income tax Promissory note. File free state income tax Option. File free state income tax Borrowed funds. File free state income tax Limits on DeductionsCarryovers Records To KeepCash Contributions Noncash Contributions Out-of-Pocket Expenses How To Report 25. File free state income tax   Nonbusiness Casualty and Theft LossesWhat's New Introduction Useful Items - You may want to see: CasualtyFamily pet. File free state income tax Progressive deterioration. File free state income tax Damage from corrosive drywall. File free state income tax Theft Loss on Deposits Proof of Loss Figuring a LossDecrease in Fair Market Value Adjusted Basis Insurance and Other Reimbursements Single Casualty on Multiple Properties Deduction Limits$100 Rule 10% Rule When To Report Gains and LossesDisaster Area Loss How To Report Gains and Losses 26. File free state income tax   Car Expenses and Other Employee Business ExpensesWhat's New Introduction Useful Items - You may want to see: Travel ExpensesTraveling Away From Home Tax Home Temporary Assignment or Job What Travel Expenses Are Deductible? Travel in the United States Travel Outside the United States Conventions Entertainment Expenses50% Limit What Entertainment Expenses Are Deductible? What Entertainment Expenses Are Not Deductible? Gift Expenses Transportation ExpensesArmed Forces reservists. File free state income tax Parking fees. File free state income tax Advertising display on car. File free state income tax Car pools. File free state income tax Hauling tools or instruments. File free state income tax Union members' trips from a union hall. File free state income tax Car Expenses RecordkeepingHow To Prove Expenses How Long To Keep Records and Receipts How To ReportGifts. File free state income tax Statutory employees. File free state income tax Reimbursements Completing Forms 2106 and 2106-EZ Special Rules 27. File free state income tax   Tax Benefits for Work-Related EducationWhat's New Introduction Useful Items - You may want to see: Qualifying Work-Related EducationEducation Required by Employer or by Law Education To Maintain or Improve Skills Education To Meet Minimum Requirements Education That Qualifies You for a New Trade or Business What Expenses Can Be DeductedUnclaimed reimbursement. File free state income tax Transportation Expenses Travel Expenses No Double Benefit Allowed Reimbursements Deducting Business ExpensesSelf-Employed Persons Employees Performing Artists and Fee-Basis Officials Impairment-Related Work Expenses Recordkeeping 28. File free state income tax   Miscellaneous DeductionsWhat's New Introduction Useful Items - You may want to see: Deductions Subject to the 2% LimitUnreimbursed Employee Expenses (Line 21) Tax Preparation Fees (Line 22) Other Expenses (Line 23) Deductions Not Subject to the 2% LimitList of Deductions Nondeductible ExpensesList of Nondeductible Expenses 29. File free state income tax   Limit on Itemized DeductionsIntroduction Useful Items - You may want to see: Are You Subject to the Limit? Which Itemized Deductions Are Limited? Which Itemized Deductions Are Not Limited? How Do You Figure the Limit?Example. File free state income tax Prev  Up  Next   Home   More Online Publications
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Charity and Nonprofit Audits

This web page will explain the IRS audit process for charities and other nonprofit organizations. IRS Exempt Organizations is continuously exploring how to improve our service to charities and other nonprofit organizations, and we hope you will find the information on this page useful.

You’ve probably reached this page because your charity or other nonprofit organization received a letter or phone call from IRS Exempt Organizations (EO) Examinations saying it had been selected for a review of its returns. The type of review is one of the following:

  • Audits: The IRS conducts two types of audits--

  • Non-audits: If the letter indicates the IRS is conducting a compliance check, then you're not being audited.

    Note: The IRS also sometimes asks organizations to complete questionnaires to help us better understand how organizations satisfy federal tax law requirements. Neither compliance checks nor compliance check questionnaires are audits.

Organizations are selected for reviews for a variety of reasons, and the scope of the audit or compliance check will vary based on the type of review.

An audit starts with the initial contact and continues until a closing letter is issued. A compliance check or compliance check questionnaire starts with the initial contact. The IRS may contact the organization again if the IRS needs further information, or if the organization does not respond to the compliance check or questionnaire. The IRS typically issues a closing letter at the end of a compliance check, but not at the end of a compliance check questionnaire.

Taxpayer rights:

Additional information - charity and nonprofit audits

Additional information - IRS Exempt Organizations

Other IRS-wide considerations:

Page Last Reviewed or Updated: 26-Nov-2013

The File Free State Income Tax

File free state income tax 27. File free state income tax   Tax Benefits for Work-Related Education Table of Contents What's New Introduction Useful Items - You may want to see: Qualifying Work-Related EducationEducation Required by Employer or by Law Education To Maintain or Improve Skills Education To Meet Minimum Requirements Education That Qualifies You for a New Trade or Business What Expenses Can Be DeductedUnclaimed reimbursement. File free state income tax Transportation Expenses Travel Expenses No Double Benefit Allowed Reimbursements Deducting Business ExpensesSelf-Employed Persons Employees Performing Artists and Fee-Basis Officials Impairment-Related Work Expenses Recordkeeping What's New Standard mileage rate. File free state income tax  Generally, if you claim a business deduction for work-related education and you drive your car to and from school, the amount you can deduct for miles driven from January 1, 2013, through December 31, 2013, is 56½ cents per mile. File free state income tax For more information, see Transportation Expenses under What Expenses Can Be Deducted. File free state income tax Introduction This chapter discusses work-related education expenses that you may be able to deduct as business expenses. File free state income tax To claim such a deduction, you must: Itemize your deductions on Schedule A (Form 1040) if you are an employee, File Schedule C (Form 1040), Schedule C-EZ (Form 1040), or Schedule F (Form 1040) if you are self-employed, and Have expenses for education that meet the requirements discussed under Qualifying Work-Related Education . File free state income tax If you are an employee and can itemize your deductions, you may be able to claim a deduction for the expenses you pay for your work-related education. File free state income tax Your deduction will be the amount by which your qualifying work-related education expenses plus other job and certain miscellaneous expenses (except for impairment-related work expenses of disabled individuals) is greater than 2% of your adjusted gross income. File free state income tax See chapter 28. File free state income tax If you are self-employed, you deduct your expenses for qualifying work-related education directly from your self-employment income. File free state income tax Your work-related education expenses may also qualify you for other tax benefits, such as the American opportunity and lifetime learning credits (see chapter 35). File free state income tax You may qualify for these other benefits even if you do not meet the requirements listed earlier. File free state income tax Also, keep in mind that your work-related education expenses may qualify you to claim more than one tax benefit. File free state income tax Generally, you may claim any number of benefits as long as you use different expenses to figure each one. File free state income tax When you figure your taxes, you may want to compare these tax benefits so you can choose the method(s) that give you the lowest tax liability. File free state income tax Useful Items - You may want to see: Publication 463 Travel, Entertainment, Gift, and Car Expenses 970 Tax Benefits for Education Form (and Instructions) 2106 Employee Business Expenses 2106-EZ Unreimbursed Employee Business Expenses Schedule A (Form 1040) Itemized Deductions Qualifying Work-Related Education You can deduct the costs of qualifying work-related education as business expenses. File free state income tax This is education that meets at least one of the following two tests. File free state income tax The education is required by your employer or the law to keep your present salary, status, or job. File free state income tax The required education must serve a bona fide business purpose of your employer. File free state income tax The education maintains or improves skills needed in your present work. File free state income tax However, even if the education meets one or both of the above tests, it is not qualifying work-related education if it: Is needed to meet the minimum educational requirements of your present trade or business, or Is part of a program of study that will qualify you for a new trade or business. File free state income tax You can deduct the costs of qualifying work-related education as a business expense even if the education could lead to a degree. File free state income tax Use Figure 27-A, later, as a quick check to see if your education qualifies. File free state income tax Education Required by Employer or by Law Once you have met the minimum educational requirements for your job, your employer or the law may require you to get more education. File free state income tax This additional education is qualifying work-related education if all three of the following requirements are met. File free state income tax It is required for you to keep your present salary, status, or job, The requirement serves a bona fide business purpose of your employer, and The education is not part of a program that will qualify you for a new trade or business. File free state income tax When you get more education than your employer or the law requires, the additional education can be qualifying work-related education only if it maintains or improves skills required in your present work. File free state income tax See Education To Maintain or Improve Skills , later. File free state income tax Example. File free state income tax You are a teacher who has satisfied the minimum requirements for teaching. File free state income tax Your employer requires you to take an additional college course each year to keep your teaching job. File free state income tax If the courses will not qualify you for a new trade or business, they are qualifying work-related education even if you eventually receive a master's degree and an increase in salary because of this extra education. File free state income tax Education To Maintain or Improve Skills If your education is not required by your employer or the law, it can be qualifying work-related education only if it maintains or improves skills needed in your present work. File free state income tax This could include refresher courses, courses on current developments, and academic or vocational courses. File free state income tax Example. File free state income tax You repair televisions, radios, and stereo systems for XYZ Store. File free state income tax To keep up with the latest changes, you take special courses in radio and stereo service. File free state income tax These courses maintain and improve skills required in your work. File free state income tax Maintaining skills vs. File free state income tax qualifying for new job. File free state income tax   Education to maintain or improve skills needed in your present work is not qualifying education if it will also qualify you for a new trade or business. File free state income tax Education during temporary absence. File free state income tax   If you stop working for a year or less in order to get education to maintain or improve skills needed in your present work and then return to the same general type of work, your absence is considered temporary. File free state income tax Education that you get during a temporary absence is qualifying work-related education if it maintains or improves skills needed in your present work. File free state income tax Example. File free state income tax You quit your biology research job to become a full-time biology graduate student for one year. File free state income tax If you return to work in biology research after completing the courses, the education is related to your present work even if you do not go back to work with the same employer. File free state income tax Education during indefinite absence. File free state income tax   If you stop work for more than a year, your absence from your job is considered indefinite. File free state income tax Education during an indefinite absence, even if it maintains or improves skills needed in the work from which you are absent, is considered to qualify you for a new trade or business. File free state income tax Therefore, it is not qualifying work-related education. File free state income tax Education To Meet Minimum Requirements Education you need to meet the minimum educational requirements for your present trade or business is not qualifying work-related education. File free state income tax The minimum educational requirements are determined by: Laws and regulations, Standards of your profession, trade, or business, and Your employer. File free state income tax Once you have met the minimum educational requirements that were in effect when you were hired, you do not have to meet any new minimum educational requirements. File free state income tax This means that if the minimum requirements change after you were hired, any education you need to meet the new requirements can be qualifying education. File free state income tax You have not necessarily met the minimum educational requirements of your trade or business simply because you are already doing the work. File free state income tax Example 1. File free state income tax You are a full-time engineering student. File free state income tax Although you have not received your degree or certification, you work part-time as an engineer for a firm that will employ you as a full-time engineer after you finish college. File free state income tax Although your college engineering courses improve your skills in your present job, they are also needed to meet the minimum job requirements for a full-time engineer. File free state income tax The education is not qualifying work-related education. File free state income tax Example 2. File free state income tax You are an accountant and you have met the minimum educational requirements of your employer. File free state income tax Your employer later changes the minimum educational requirements and requires you to take college courses to keep your job. File free state income tax These additional courses can be qualifying work-related education because you have already satisfied the minimum requirements that were in effect when you were hired. File free state income tax Requirements for Teachers States or school districts usually set the minimum educational requirements for teachers. File free state income tax The requirement is the college degree or the minimum number of college hours usually required of a person hired for that position. File free state income tax If there are no requirements, you will have met the minimum educational requirements when you become a faculty member. File free state income tax The determination of whether you are a faculty member of an educational institution must be made on the basis of the particular practices of the institution. File free state income tax You generally will be considered a faculty member when one or more of the following occurs. File free state income tax You have tenure. File free state income tax Your years of service count toward obtaining tenure. File free state income tax You have a vote in faculty decisions. File free state income tax Your school makes contributions for you to a retirement plan other than social security or a similar program. File free state income tax Example 1. File free state income tax The law in your state requires beginning secondary school teachers to have a bachelor's degree, including 10 professional education courses. File free state income tax In addition, to keep the job a teacher must complete a fifth year of training within 10 years from the date of hire. File free state income tax If the employing school certifies to the state Department of Education that qualified teachers cannot be found, the school can hire persons with only 3 years of college. File free state income tax However, to keep their jobs, these teachers must get a bachelor's degree and the required professional education courses within 3 years. File free state income tax Under these facts, the bachelor's degree, whether or not it includes the 10 professional education courses, is considered the minimum educational requirement for qualification as a teacher in your state. File free state income tax If you have all the required education except the fifth year, you have met the minimum educational requirements. File free state income tax The fifth year of training is qualifying work-related education unless it is part of a program of study that will qualify you for a new trade or business. File free state income tax Figure 27-A Does Your Work-Related Education Qualify? Please click here for the text description of the image. File free state income tax Figure 27-A. File free state income tax Does Your Work-Related Education Qualify?" Example 2. File free state income tax Assume the same facts as in Example 1 except that you have a bachelor's degree and only six professional education courses. File free state income tax The additional four education courses can be qualifying work-related education. File free state income tax Although you do not have all the required courses, you have already met the minimum educational requirements. File free state income tax Example 3. File free state income tax Assume the same facts as in Example 1 except that you are hired with only 3 years of college. File free state income tax The courses you take that lead to a bachelor's degree (including those in education) are not qualifying work-related education. File free state income tax They are needed to meet the minimum educational requirements for employment as a teacher. File free state income tax Example 4. File free state income tax You have a bachelor's degree and you work as a temporary instructor at a university. File free state income tax At the same time, you take graduate courses toward an advanced degree. File free state income tax The rules of the university state that you can become a faculty member only if you get a graduate degree. File free state income tax Also, you can keep your job as an instructor only as long as you show satisfactory progress toward getting this degree. File free state income tax You have not met the minimum educational requirements to qualify you as a faculty member. File free state income tax The graduate courses are not qualifying work-related education. File free state income tax Certification in a new state. File free state income tax   Once you have met the minimum educational requirements for teachers for your state, you are considered to have met the minimum educational requirements in all states. File free state income tax This is true even if you must get additional education to be certified in another state. File free state income tax Any additional education you need is qualifying work-related education. File free state income tax You have already met the minimum requirements for teaching. File free state income tax Teaching in another state is not a new trade or business. File free state income tax Example. File free state income tax You hold a permanent teaching certificate in State A and are employed as a teacher in that state for several years. File free state income tax You move to State B and are promptly hired as a teacher. File free state income tax You are required, however, to complete certain prescribed courses to get a permanent teaching certificate in State B. File free state income tax These additional courses are qualifying work-related education because the teaching position in State B involves the same general kind of work for which you were qualified in State A. File free state income tax Education That Qualifies You for a New Trade or Business Education that is part of a program of study that will qualify you for a new trade or business is not qualifying work-related education. File free state income tax This is true even if you do not plan to enter that trade or business. File free state income tax If you are an employee, a change of duties that involves the same general kind of work is not a new trade or business. File free state income tax Example 1. File free state income tax You are an accountant. File free state income tax Your employer requires you to get a law degree at your own expense. File free state income tax You register at a law school for the regular curriculum that leads to a law degree. File free state income tax Even if you do not intend to become a lawyer, the education is not qualifying because the law degree will qualify you for a new trade or business. File free state income tax Example 2. File free state income tax You are a general practitioner of medicine. File free state income tax You take a 2-week course to review developments in several specialized fields of medicine. File free state income tax The course does not qualify you for a new profession. File free state income tax It is qualifying work-related education because it maintains or improves skills required in your present profession. File free state income tax Example 3. File free state income tax While working in the private practice of psychiatry, you enter a program to study and train at an accredited psychoanalytic institute. File free state income tax The program will lead to qualifying you to practice psychoanalysis. File free state income tax The psychoanalytic training does not qualify you for a new profession. File free state income tax It is qualifying work-related education because it maintains or improves skills required in your present profession. File free state income tax Bar or CPA Review Course Review courses to prepare for the bar examination or the certified public accountant (CPA) examination are not qualifying work-related education. File free state income tax They are part of a program of study that can qualify you for a new profession. File free state income tax Teaching and Related Duties All teaching and related duties are considered the same general kind of work. File free state income tax A change in duties in any of the following ways is not considered a change to a new business. File free state income tax Elementary school teacher to secondary school teacher. File free state income tax Teacher of one subject, such as biology, to teacher of another subject, such as art. File free state income tax Classroom teacher to guidance counselor. File free state income tax Classroom teacher to school administrator. File free state income tax What Expenses Can Be Deducted If your education meets the requirements described earlier under Qualifying Work-Related Education , you can generally deduct your education expenses as business expenses. File free state income tax If you are not self-employed, you can deduct business expenses only if you itemize your deductions. File free state income tax You cannot deduct expenses related to tax-exempt and excluded income. File free state income tax Deductible expenses. File free state income tax   The following education expenses can be deducted. File free state income tax Tuition, books, supplies, lab fees, and similar items. File free state income tax Certain transportation and travel costs. File free state income tax Other education expenses, such as costs of research and typing when writing a paper as part of an educational program. File free state income tax Nondeductible expenses. File free state income tax   You cannot deduct personal or capital expenses. File free state income tax For example, you cannot deduct the dollar value of vacation time or annual leave you take to attend classes. File free state income tax This amount is a personal expense. File free state income tax Unclaimed reimbursement. File free state income tax   If you do not claim reimbursement that you are entitled to receive from your employer, you cannot deduct the expenses that apply to that unclaimed reimbursement. File free state income tax Example. File free state income tax Your employer agrees to pay your education expenses if you file a voucher showing your expenses. File free state income tax You do not file a voucher, and you do not get reimbursed. File free state income tax Because you did not file a voucher, you cannot deduct the expenses on your tax return. File free state income tax Transportation Expenses If your education qualifies, you can deduct local transportation costs of going directly from work to school. File free state income tax If you are regularly employed and go to school on a temporary basis, you can also deduct the costs of returning from school to home. File free state income tax Temporary basis. File free state income tax   You go to school on a temporary basis if either of the following situations applies to you. File free state income tax Your attendance at school is realistically expected to last 1 year or less and does indeed last for 1 year or less. File free state income tax Initially, your attendance at school is realistically expected to last 1 year or less, but at a later date your attendance is reasonably expected to last more than 1 year. File free state income tax Your attendance is temporary up to the date you determine it will last more than 1 year. File free state income tax Note. File free state income tax If you are in either situation (1) or (2), your attendance is not temporary if facts and circumstances indicate otherwise. File free state income tax Attendance not on a temporary basis. File free state income tax   You do not go to school on a temporary basis if either of the following situations apply to you. File free state income tax Your attendance at school is realistically expected to last more than 1 year. File free state income tax It does not matter how long you actually attend. File free state income tax Initially, your attendance at school is realistically expected to last 1 year or less, but at a later date your attendance is reasonably expected to last more than 1 year. File free state income tax Your attendance is not temporary after the date you determine it will last more than 1 year. File free state income tax Deductible Transportation Expenses If you are regularly employed and go directly from home to school on a temporary basis, you can deduct the round-trip costs of transportation between your home and school. File free state income tax This is true regardless of the location of the school, the distance traveled, or whether you attend school on nonwork days. File free state income tax Transportation expenses include the actual costs of bus, subway, cab, or other fares, as well as the costs of using your car. File free state income tax Transportation expenses do not include amounts spent for travel, meals, or lodging while you are away from home overnight. File free state income tax Example 1. File free state income tax You regularly work in a nearby town, and go directly from work to home. File free state income tax You also attend school every work night for 3 months to take a course that improves your job skills. File free state income tax Since you are attending school on a temporary basis, you can deduct your daily round-trip transportation expenses in going between home and school. File free state income tax This is true regardless of the distance traveled. File free state income tax Example 2. File free state income tax Assume the same facts as in Example 1 except that on certain nights you go directly from work to school and then home. File free state income tax You can deduct your transportation expenses from your regular work site to school and then home. File free state income tax Example 3. File free state income tax Assume the same facts as in Example 1 except that you attend the school for 9 months on Saturdays, nonwork days. File free state income tax Since you are attending school on a temporary basis, you can deduct your round-trip transportation expenses in going between home and school. File free state income tax Example 4. File free state income tax Assume the same facts as in Example 1 except that you attend classes twice a week for 15 months. File free state income tax Since your attendance in school is not considered temporary, you cannot deduct your transportation expenses in going between home and school. File free state income tax If you go directly from work to school, you can deduct the one-way transportation expenses of going from work to school. File free state income tax If you go from work to home to school and return home, your transportation expenses cannot be more than if you had gone directly from work to school. File free state income tax Using your car. File free state income tax   If you use your car (whether you own or lease it) for transportation to school, you can deduct your actual expenses or use the standard mileage rate to figure the amount you can deduct. File free state income tax The standard mileage rate for miles driven from January 1, 2013, through December 31, 2013 is 56½ cents per mile. File free state income tax Whichever method you use, you can also deduct parking fees and tolls. File free state income tax See chapter 26 for information on deducting your actual expenses of using a car. File free state income tax Travel Expenses You can deduct expenses for travel, meals (see 50% limit on meals , later), and lodging if you travel overnight mainly to obtain qualifying work-related education. File free state income tax Travel expenses for qualifying work-related education are treated the same as travel expenses for other employee business purposes. File free state income tax For more information, see chapter 26. File free state income tax You cannot deduct expenses for personal activities, such as sightseeing, visiting, or entertaining. File free state income tax Mainly personal travel. File free state income tax   If your travel away from home is mainly personal, you cannot deduct all of your expenses for travel, meals, and lodging. File free state income tax You can deduct only your expenses for lodging and 50% of your expenses for meals during the time you attend the qualified educational activities. File free state income tax   Whether a trip's purpose is mainly personal or educational depends upon the facts and circumstances. File free state income tax An important factor is the comparison of time spent on personal activities with time spent on educational activities. File free state income tax If you spend more time on personal activities, the trip is considered mainly educational only if you can show a substantial nonpersonal reason for traveling to a particular location. File free state income tax Example 1. File free state income tax John works in Newark, New Jersey. File free state income tax He traveled to Chicago to take a deductible 1-week course at the request of his employer. File free state income tax His main reason for going to Chicago was to take the course. File free state income tax While there, he took a sight-seeing trip, entertained some friends, and took a side trip to Pleasantville for a day. File free state income tax Since the trip was mainly for business, John can deduct his round-trip airfare to Chicago. File free state income tax He cannot deduct his transportation expenses of going to Pleasantville. File free state income tax He can deduct only the meals (subject to the 50% limit) and lodging connected with his educational activities. File free state income tax Example 2. File free state income tax Sue works in Boston. File free state income tax She went to a university in Michigan to take a course for work. File free state income tax The course is qualifying work-related education. File free state income tax She took one course, which is one-fourth of a full course load of study. File free state income tax She spent the rest of the time on personal activities. File free state income tax Her reasons for taking the course in Michigan were all personal. File free state income tax Sue's trip is mainly personal because three-fourths of her time is considered personal time. File free state income tax She cannot deduct the cost of her round-trip train ticket to Michigan. File free state income tax She can deduct one-fourth of the meals (subject to the 50% limit) and lodging costs for the time she attended the university. File free state income tax Example 3. File free state income tax Dave works in Nashville and recently traveled to California to take a 2-week seminar. File free state income tax The seminar is qualifying work-related education. File free state income tax While there, he spent an extra 8 weeks on personal activities. File free state income tax The facts, including the extra 8-week stay, show that his main purpose was to take a vacation. File free state income tax Dave cannot deduct his round-trip airfare or his meals and lodging for the 8 weeks. File free state income tax He can deduct only his expenses for meals (subject to the 50% limit) and lodging for the 2 weeks he attended the seminar. File free state income tax Cruises and conventions. File free state income tax   Certain cruises and conventions offer seminars or courses as part of their itinerary. File free state income tax Even if the seminars or courses are work-related, your deduction for travel may be limited. File free state income tax This applies to: Travel by ocean liner, cruise ship, or other form of luxury water transportation, and Conventions outside the North American area. File free state income tax   For a discussion of the limits on travel expense deductions that apply to cruises and conventions, see Luxury Water Travel and Conventions in chapter 1 of Publication 463. File free state income tax 50% limit on meals. File free state income tax   You can deduct only 50% of the cost of your meals while traveling away from home to obtain qualifying work-related education. File free state income tax You cannot have been reimbursed for the meals. File free state income tax   Employees must use Form 2106 or Form 2106-EZ to apply the 50% limit. File free state income tax Travel as Education You cannot deduct the cost of travel as a form of education even if it is directly related to your duties in your work or business. File free state income tax Example. File free state income tax You are a French language teacher. File free state income tax While on sabbatical leave granted for travel, you traveled through France to improve your knowledge of the French language. File free state income tax You chose your itinerary and most of your activities to improve your French language skills. File free state income tax You cannot deduct your travel expenses as education expenses. File free state income tax This is true even if you spent most of your time learning French by visiting French schools and families, attending movies or plays, and engaging in similar activities. File free state income tax No Double Benefit Allowed You cannot do either of the following. File free state income tax Deduct work-related education expenses as business expenses if you benefit from these expenses under any other provision of the law, for example, the tuition and fees deduction (see chapter 35). File free state income tax Deduct work-related education expenses paid with tax-free scholarship, grant, or employer-provided educational assistance. File free state income tax See Adjustments to Qualifying Work-Related Education Expenses , next. File free state income tax Adjustments to Qualifying Work-Related Education Expenses If you pay qualifying work-related education expenses with certain tax-free funds, you cannot claim a deduction for those amounts. File free state income tax You must reduce the qualifying expenses by the amount of such expenses allocable to the tax-free educational assistance. File free state income tax For more information, see chapter 12 of Publication 970. File free state income tax Tax-free educational assistance includes: The tax-free part of scholarships and fellowships (see chapter 1 of Publication 970), The tax-free part of Pell grants (see chapter 1 of Publication 970), The tax-free part of employer-provided educational assistance (see chapter 11 of Publication 970), Veterans' educational assistance (see chapter 1 of Publication 970), and Any other nontaxable (tax-free) payments (other than gifts or inheritances) received for education assistance. File free state income tax Amounts that do not reduce qualifying work-related education expenses. File free state income tax   Do not reduce the qualifying work-related education expenses by amounts paid with funds the student receives as: Payment for services, such as wages, A loan, A gift, An inheritance, or A withdrawal from the student's personal savings. File free state income tax   Also, do not reduce the qualifying work-related education expenses by any scholarship or fellowship reported as income on the student's return or any scholarship which, by its terms, cannot be applied to qualifying work-related education expenses. File free state income tax Reimbursements How you treat reimbursements depends on the arrangement you have with your employer. File free state income tax There are two basic types of reimbursement arrangements—accountable plans and nonaccountable plans. File free state income tax You can tell the type of plan you are reimbursed under by the way the reimbursement is reported on your Form W-2. File free state income tax For information on how to treat reimbursements under both accountable and nonaccountable plans, see Reimbursements in chapter 26. File free state income tax Deducting Business Expenses Self-employed persons and employees report business expenses differently. File free state income tax The following information explains what forms you must use to deduct the cost of your qualifying work-related education as a business expense. File free state income tax Self-Employed Persons If you are self-employed, report the cost of your qualifying work-related education on the appropriate form used to report your business income and expenses (generally Schedule C, C-EZ, or F). File free state income tax If your educational expenses include expenses for a car or truck, travel, or meals, report those expenses the same way you report other business expenses for those items. File free state income tax See the instructions for the form you file for information on how to complete it. File free state income tax Employees If you are an employee, you can deduct the cost of qualifying work-related education only if you: Did not receive (and were not entitled to receive) any reimbursement from your employer, Were reimbursed under a nonaccountable plan (amount is included in box 1 of Form W-2), or Received reimbursement under an accountable plan, but the amount received was less than your expenses for which you claimed reimbursement. File free state income tax If either (1) or (2) applies, you can deduct the total qualifying cost. File free state income tax If (3) applies, you can deduct only the qualifying costs that were more than your reimbursement. File free state income tax In order to deduct the cost of your qualifying work-related education as a business expense, include the amount with your deduction for any other employee business expenses on Schedule A (Form 1040), line 21. File free state income tax (Special rules for expenses of certain performing artists and fee-basis officials and for impairment-related work expenses are explained later. File free state income tax ) This deduction (except for impairment-related work expenses of disabled individuals) is subject to the 2%-of-adjusted-gross-income limit that applies to most miscellaneous itemized deductions. File free state income tax See chapter 28. File free state income tax Form 2106 or 2106-EZ. File free state income tax   To figure your deduction for employee business expenses, including qualifying work-related education, you generally must complete Form 2106 or Form 2106-EZ. File free state income tax Form not required. File free state income tax   Do not complete either Form 2106 or Form 2106-EZ if: If amounts included in box 1 of your Form W-2, are not considered reimbursements, and You are not claiming travel, transportation, meal, or entertainment expenses. File free state income tax   If you meet both of these requirements, enter the expenses directly on Schedule A (Form 1040), line 21. File free state income tax (Special rules for expenses of certain performing artists and fee-basis officials and for impairment-related work expenses are explained later. File free state income tax ) Using Form 2106-EZ. File free state income tax   This form is shorter and easier to use than Form 2106. File free state income tax Generally, you can use this form if: All reimbursements, if any, are included in box 1 of your Form W-2, and You are using the standard mileage rate if you are claiming vehicle expenses. File free state income tax   If you do not meet both of these requirements, use Form 2106. File free state income tax Performing Artists and Fee-Basis Officials If you are a qualified performing artist, or a state (or local) government official who is paid in whole or in part on a fee basis, you can deduct the cost of your qualifying work-related education as an adjustment to gross income rather than as an itemized deduction. File free state income tax Include the cost of your qualifying work-related education with any other employee business expenses on Form 1040, line 24. File free state income tax You do not have to itemize your deductions on Schedule A (Form 1040), and, therefore, the deduction is not subject to the 2%-of-adjusted-gross-income limit. File free state income tax You must complete Form 2106 or 2106-EZ to figure your deduction, even if you meet the requirements described earlier under Form not required . File free state income tax For more information on qualified performing artists, see chapter 6 of Publication 463. File free state income tax Impairment-Related Work Expenses If you are disabled and have impairment-related work expenses that are necessary for you to be able to get qualifying work-related education, you can deduct these expenses on Schedule A (Form 1040), line 28. File free state income tax They are not subject to the 2%-of-adjusted-gross-income limit. File free state income tax To deduct these expenses, you must complete Form 2106 or 2106-EZ even if you meet the requirements described earlier under Form not required . File free state income tax For more information on impairment-related work expenses, see chapter 6 of Publication 463. File free state income tax Recordkeeping You must keep records as proof of any deduction claimed on your tax return. File free state income tax Generally, you should keep your records for 3 years from the date of filing the tax return and claiming the deduction. File free state income tax For specific information about keeping records of business expenses, see Recordkeeping in chapter 26. File free state income tax Prev  Up  Next   Home   More Online Publications