What Schools Should Know as IRS Increases Educator Expense Tax Deduction for 2022

Earlier this year, teachers who buy school supplies out of their own pocket received a bit of much-needed good news from an unlikely source: the Internal Revenue Service. Yes, you read that correctly – the IRS. In March, the agency announced a raise in the special educator expense deduction for the first time in nearly two decades. On August 10, with schools and teachers preparing to go back to school, the agency reminded educators that beginning this year, qualifying educators may deduct up to $300 of qualifying out-of-pocket classroom expenses. This welcome increase of $50 is the first such raise in the deduction amount since being introduced back in 2002. Educator couples who file their taxes jointly can file for a $600 exception, with the limit remaining $300 per educator. What do schools need to know about this welcome development?

The Details

According to the IRS news release outlining the increase, the deduction is available to all eligible educators. This category includes “anyone who is a kindergarten through grade 12 teacher, instructor, counselor, principal or aide in a school for at least 900 hours during the school year.” And, importantly, this deduction is accessible to educators at both public and private schools, even if they take the standard deduction on their taxes. Eligible educators may deduct the unreimbursed cost of books, classroom supplies, equipment, and COVID-19 protective items that will be used in classrooms.

Hopefully, educators will not have to wait nearly 20 years for the next raise in the deduction amount, as the IRS indicated that the deduction will continue to increase $50 based on adjustments for inflation.

Proceed With Caution

The news release also reminded teachers who may have gotten an extension on their 2021 tax filings that the old $250 limit will still apply to any outstanding 2021 filings, with the $300 limit applying starting with 2022 filings. Additionally, it is important for teachers to keep receipts and other records documenting purchases of school supplies.

What Should Schools Do?

While you should not give individual teachers tax advice, you should make all your faculty members aware of this encouraging and long-overdue update. We recommend you share this link with them so they can learn of the details.

We will monitor these developments and provide updates as warranted, so make sure that you are subscribed to Fisher Phillips’ Insights to get the most up-to-date information direct to your inbox. If you have further questions, contact your Fisher Phillips attorney, the author of this Insight, or any attorney in our Education Practice Group.