IR-2004-124, Oct. 13, 2004

EDUCATORS SHOULD SAVE RECEIPTS FOR REINSTATED DEDUCTION

WASHINGTON � The Internal Revenue Service today advised teachers and other
educators to save their receipts for books and other classroom supplies.
They will be able to deduct up to $250 of such expenses again this year,
following recently-enacted legislation.

The Working Families Tax Relief Act of 2004 reinstated the educator
expense deduction, which had expired at the end of last year, for both
2004 and 2005. Expenses incurred any time this year may qualify for the
deduction, not just those since the Act was signed on October 4.

The deduction is available to eligible educators in public or private
elementary or secondary schools. To be eligible, a person must work at
least 900 hours during a school year as a teacher, instructor, counselor,
principal or aide.

An educator may subtract up to $250 of qualified out-of-pocket expenses
when figuring adjusted gross income (AGI). This deduction is available
whether or not the taxpayer itemizes deductions on Schedule A.

The IRS suggests that educators keep records of qualifying expenses in a
folder or envelope with a label such as �Educator Expense Deduction,�
noting the date, amount and purpose of each purchase. This will help
prevent a missed deduction at tax time.

For more information, call the IRS Tele-Tax system toll-free at
1-800-829-4477 and select Topic 458. Or go to the IRS Web site at
www.irs.gov and use its search engine to find Tax Topic 458.


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