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2011 Irs Form 8863

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2011 Irs Form 8863

2011 irs form 8863 27. 2011 irs form 8863   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. 2011 irs form 8863 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. 2011 irs form 8863  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. 2011 irs form 8863 For more information, see Transportation Expenses under What Expenses Can Be Deducted. 2011 irs form 8863 Introduction This chapter discusses work-related education expenses that you may be able to deduct as business expenses. 2011 irs form 8863 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 . 2011 irs form 8863 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. 2011 irs form 8863 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. 2011 irs form 8863 See chapter 28. 2011 irs form 8863 If you are self-employed, you deduct your expenses for qualifying work-related education directly from your self-employment income. 2011 irs form 8863 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). 2011 irs form 8863 You may qualify for these other benefits even if you do not meet the requirements listed earlier. 2011 irs form 8863 Also, keep in mind that your work-related education expenses may qualify you to claim more than one tax benefit. 2011 irs form 8863 Generally, you may claim any number of benefits as long as you use different expenses to figure each one. 2011 irs form 8863 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. 2011 irs form 8863 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. 2011 irs form 8863 This is education that meets at least one of the following two tests. 2011 irs form 8863 The education is required by your employer or the law to keep your present salary, status, or job. 2011 irs form 8863 The required education must serve a bona fide business purpose of your employer. 2011 irs form 8863 The education maintains or improves skills needed in your present work. 2011 irs form 8863 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. 2011 irs form 8863 You can deduct the costs of qualifying work-related education as a business expense even if the education could lead to a degree. 2011 irs form 8863 Use Figure 27-A, later, as a quick check to see if your education qualifies. 2011 irs form 8863 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. 2011 irs form 8863 This additional education is qualifying work-related education if all three of the following requirements are met. 2011 irs form 8863 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. 2011 irs form 8863 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. 2011 irs form 8863 See Education To Maintain or Improve Skills , later. 2011 irs form 8863 Example. 2011 irs form 8863 You are a teacher who has satisfied the minimum requirements for teaching. 2011 irs form 8863 Your employer requires you to take an additional college course each year to keep your teaching job. 2011 irs form 8863 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. 2011 irs form 8863 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. 2011 irs form 8863 This could include refresher courses, courses on current developments, and academic or vocational courses. 2011 irs form 8863 Example. 2011 irs form 8863 You repair televisions, radios, and stereo systems for XYZ Store. 2011 irs form 8863 To keep up with the latest changes, you take special courses in radio and stereo service. 2011 irs form 8863 These courses maintain and improve skills required in your work. 2011 irs form 8863 Maintaining skills vs. 2011 irs form 8863 qualifying for new job. 2011 irs form 8863   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. 2011 irs form 8863 Education during temporary absence. 2011 irs form 8863   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. 2011 irs form 8863 Education that you get during a temporary absence is qualifying work-related education if it maintains or improves skills needed in your present work. 2011 irs form 8863 Example. 2011 irs form 8863 You quit your biology research job to become a full-time biology graduate student for one year. 2011 irs form 8863 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. 2011 irs form 8863 Education during indefinite absence. 2011 irs form 8863   If you stop work for more than a year, your absence from your job is considered indefinite. 2011 irs form 8863 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. 2011 irs form 8863 Therefore, it is not qualifying work-related education. 2011 irs form 8863 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. 2011 irs form 8863 The minimum educational requirements are determined by: Laws and regulations, Standards of your profession, trade, or business, and Your employer. 2011 irs form 8863 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. 2011 irs form 8863 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. 2011 irs form 8863 You have not necessarily met the minimum educational requirements of your trade or business simply because you are already doing the work. 2011 irs form 8863 Example 1. 2011 irs form 8863 You are a full-time engineering student. 2011 irs form 8863 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. 2011 irs form 8863 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. 2011 irs form 8863 The education is not qualifying work-related education. 2011 irs form 8863 Example 2. 2011 irs form 8863 You are an accountant and you have met the minimum educational requirements of your employer. 2011 irs form 8863 Your employer later changes the minimum educational requirements and requires you to take college courses to keep your job. 2011 irs form 8863 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. 2011 irs form 8863 Requirements for Teachers States or school districts usually set the minimum educational requirements for teachers. 2011 irs form 8863 The requirement is the college degree or the minimum number of college hours usually required of a person hired for that position. 2011 irs form 8863 If there are no requirements, you will have met the minimum educational requirements when you become a faculty member. 2011 irs form 8863 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. 2011 irs form 8863 You generally will be considered a faculty member when one or more of the following occurs. 2011 irs form 8863 You have tenure. 2011 irs form 8863 Your years of service count toward obtaining tenure. 2011 irs form 8863 You have a vote in faculty decisions. 2011 irs form 8863 Your school makes contributions for you to a retirement plan other than social security or a similar program. 2011 irs form 8863 Example 1. 2011 irs form 8863 The law in your state requires beginning secondary school teachers to have a bachelor's degree, including 10 professional education courses. 2011 irs form 8863 In addition, to keep the job a teacher must complete a fifth year of training within 10 years from the date of hire. 2011 irs form 8863 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. 2011 irs form 8863 However, to keep their jobs, these teachers must get a bachelor's degree and the required professional education courses within 3 years. 2011 irs form 8863 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. 2011 irs form 8863 If you have all the required education except the fifth year, you have met the minimum educational requirements. 2011 irs form 8863 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. 2011 irs form 8863 Figure 27-A Does Your Work-Related Education Qualify? Please click here for the text description of the image. 2011 irs form 8863 Figure 27-A. 2011 irs form 8863 Does Your Work-Related Education Qualify?" Example 2. 2011 irs form 8863 Assume the same facts as in Example 1 except that you have a bachelor's degree and only six professional education courses. 2011 irs form 8863 The additional four education courses can be qualifying work-related education. 2011 irs form 8863 Although you do not have all the required courses, you have already met the minimum educational requirements. 2011 irs form 8863 Example 3. 2011 irs form 8863 Assume the same facts as in Example 1 except that you are hired with only 3 years of college. 2011 irs form 8863 The courses you take that lead to a bachelor's degree (including those in education) are not qualifying work-related education. 2011 irs form 8863 They are needed to meet the minimum educational requirements for employment as a teacher. 2011 irs form 8863 Example 4. 2011 irs form 8863 You have a bachelor's degree and you work as a temporary instructor at a university. 2011 irs form 8863 At the same time, you take graduate courses toward an advanced degree. 2011 irs form 8863 The rules of the university state that you can become a faculty member only if you get a graduate degree. 2011 irs form 8863 Also, you can keep your job as an instructor only as long as you show satisfactory progress toward getting this degree. 2011 irs form 8863 You have not met the minimum educational requirements to qualify you as a faculty member. 2011 irs form 8863 The graduate courses are not qualifying work-related education. 2011 irs form 8863 Certification in a new state. 2011 irs form 8863   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. 2011 irs form 8863 This is true even if you must get additional education to be certified in another state. 2011 irs form 8863 Any additional education you need is qualifying work-related education. 2011 irs form 8863 You have already met the minimum requirements for teaching. 2011 irs form 8863 Teaching in another state is not a new trade or business. 2011 irs form 8863 Example. 2011 irs form 8863 You hold a permanent teaching certificate in State A and are employed as a teacher in that state for several years. 2011 irs form 8863 You move to State B and are promptly hired as a teacher. 2011 irs form 8863 You are required, however, to complete certain prescribed courses to get a permanent teaching certificate in State B. 2011 irs form 8863 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. 2011 irs form 8863 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. 2011 irs form 8863 This is true even if you do not plan to enter that trade or business. 2011 irs form 8863 If you are an employee, a change of duties that involves the same general kind of work is not a new trade or business. 2011 irs form 8863 Example 1. 2011 irs form 8863 You are an accountant. 2011 irs form 8863 Your employer requires you to get a law degree at your own expense. 2011 irs form 8863 You register at a law school for the regular curriculum that leads to a law degree. 2011 irs form 8863 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. 2011 irs form 8863 Example 2. 2011 irs form 8863 You are a general practitioner of medicine. 2011 irs form 8863 You take a 2-week course to review developments in several specialized fields of medicine. 2011 irs form 8863 The course does not qualify you for a new profession. 2011 irs form 8863 It is qualifying work-related education because it maintains or improves skills required in your present profession. 2011 irs form 8863 Example 3. 2011 irs form 8863 While working in the private practice of psychiatry, you enter a program to study and train at an accredited psychoanalytic institute. 2011 irs form 8863 The program will lead to qualifying you to practice psychoanalysis. 2011 irs form 8863 The psychoanalytic training does not qualify you for a new profession. 2011 irs form 8863 It is qualifying work-related education because it maintains or improves skills required in your present profession. 2011 irs form 8863 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. 2011 irs form 8863 They are part of a program of study that can qualify you for a new profession. 2011 irs form 8863 Teaching and Related Duties All teaching and related duties are considered the same general kind of work. 2011 irs form 8863 A change in duties in any of the following ways is not considered a change to a new business. 2011 irs form 8863 Elementary school teacher to secondary school teacher. 2011 irs form 8863 Teacher of one subject, such as biology, to teacher of another subject, such as art. 2011 irs form 8863 Classroom teacher to guidance counselor. 2011 irs form 8863 Classroom teacher to school administrator. 2011 irs form 8863 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. 2011 irs form 8863 If you are not self-employed, you can deduct business expenses only if you itemize your deductions. 2011 irs form 8863 You cannot deduct expenses related to tax-exempt and excluded income. 2011 irs form 8863 Deductible expenses. 2011 irs form 8863   The following education expenses can be deducted. 2011 irs form 8863 Tuition, books, supplies, lab fees, and similar items. 2011 irs form 8863 Certain transportation and travel costs. 2011 irs form 8863 Other education expenses, such as costs of research and typing when writing a paper as part of an educational program. 2011 irs form 8863 Nondeductible expenses. 2011 irs form 8863   You cannot deduct personal or capital expenses. 2011 irs form 8863 For example, you cannot deduct the dollar value of vacation time or annual leave you take to attend classes. 2011 irs form 8863 This amount is a personal expense. 2011 irs form 8863 Unclaimed reimbursement. 2011 irs form 8863   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. 2011 irs form 8863 Example. 2011 irs form 8863 Your employer agrees to pay your education expenses if you file a voucher showing your expenses. 2011 irs form 8863 You do not file a voucher, and you do not get reimbursed. 2011 irs form 8863 Because you did not file a voucher, you cannot deduct the expenses on your tax return. 2011 irs form 8863 Transportation Expenses If your education qualifies, you can deduct local transportation costs of going directly from work to school. 2011 irs form 8863 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. 2011 irs form 8863 Temporary basis. 2011 irs form 8863   You go to school on a temporary basis if either of the following situations applies to you. 2011 irs form 8863 Your attendance at school is realistically expected to last 1 year or less and does indeed last for 1 year or less. 2011 irs form 8863 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. 2011 irs form 8863 Your attendance is temporary up to the date you determine it will last more than 1 year. 2011 irs form 8863 Note. 2011 irs form 8863 If you are in either situation (1) or (2), your attendance is not temporary if facts and circumstances indicate otherwise. 2011 irs form 8863 Attendance not on a temporary basis. 2011 irs form 8863   You do not go to school on a temporary basis if either of the following situations apply to you. 2011 irs form 8863 Your attendance at school is realistically expected to last more than 1 year. 2011 irs form 8863 It does not matter how long you actually attend. 2011 irs form 8863 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. 2011 irs form 8863 Your attendance is not temporary after the date you determine it will last more than 1 year. 2011 irs form 8863 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. 2011 irs form 8863 This is true regardless of the location of the school, the distance traveled, or whether you attend school on nonwork days. 2011 irs form 8863 Transportation expenses include the actual costs of bus, subway, cab, or other fares, as well as the costs of using your car. 2011 irs form 8863 Transportation expenses do not include amounts spent for travel, meals, or lodging while you are away from home overnight. 2011 irs form 8863 Example 1. 2011 irs form 8863 You regularly work in a nearby town, and go directly from work to home. 2011 irs form 8863 You also attend school every work night for 3 months to take a course that improves your job skills. 2011 irs form 8863 Since you are attending school on a temporary basis, you can deduct your daily round-trip transportation expenses in going between home and school. 2011 irs form 8863 This is true regardless of the distance traveled. 2011 irs form 8863 Example 2. 2011 irs form 8863 Assume the same facts as in Example 1 except that on certain nights you go directly from work to school and then home. 2011 irs form 8863 You can deduct your transportation expenses from your regular work site to school and then home. 2011 irs form 8863 Example 3. 2011 irs form 8863 Assume the same facts as in Example 1 except that you attend the school for 9 months on Saturdays, nonwork days. 2011 irs form 8863 Since you are attending school on a temporary basis, you can deduct your round-trip transportation expenses in going between home and school. 2011 irs form 8863 Example 4. 2011 irs form 8863 Assume the same facts as in Example 1 except that you attend classes twice a week for 15 months. 2011 irs form 8863 Since your attendance in school is not considered temporary, you cannot deduct your transportation expenses in going between home and school. 2011 irs form 8863 If you go directly from work to school, you can deduct the one-way transportation expenses of going from work to school. 2011 irs form 8863 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. 2011 irs form 8863 Using your car. 2011 irs form 8863   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. 2011 irs form 8863 The standard mileage rate for miles driven from January 1, 2013, through December 31, 2013 is 56½ cents per mile. 2011 irs form 8863 Whichever method you use, you can also deduct parking fees and tolls. 2011 irs form 8863 See chapter 26 for information on deducting your actual expenses of using a car. 2011 irs form 8863 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. 2011 irs form 8863 Travel expenses for qualifying work-related education are treated the same as travel expenses for other employee business purposes. 2011 irs form 8863 For more information, see chapter 26. 2011 irs form 8863 You cannot deduct expenses for personal activities, such as sightseeing, visiting, or entertaining. 2011 irs form 8863 Mainly personal travel. 2011 irs form 8863   If your travel away from home is mainly personal, you cannot deduct all of your expenses for travel, meals, and lodging. 2011 irs form 8863 You can deduct only your expenses for lodging and 50% of your expenses for meals during the time you attend the qualified educational activities. 2011 irs form 8863   Whether a trip's purpose is mainly personal or educational depends upon the facts and circumstances. 2011 irs form 8863 An important factor is the comparison of time spent on personal activities with time spent on educational activities. 2011 irs form 8863 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. 2011 irs form 8863 Example 1. 2011 irs form 8863 John works in Newark, New Jersey. 2011 irs form 8863 He traveled to Chicago to take a deductible 1-week course at the request of his employer. 2011 irs form 8863 His main reason for going to Chicago was to take the course. 2011 irs form 8863 While there, he took a sight-seeing trip, entertained some friends, and took a side trip to Pleasantville for a day. 2011 irs form 8863 Since the trip was mainly for business, John can deduct his round-trip airfare to Chicago. 2011 irs form 8863 He cannot deduct his transportation expenses of going to Pleasantville. 2011 irs form 8863 He can deduct only the meals (subject to the 50% limit) and lodging connected with his educational activities. 2011 irs form 8863 Example 2. 2011 irs form 8863 Sue works in Boston. 2011 irs form 8863 She went to a university in Michigan to take a course for work. 2011 irs form 8863 The course is qualifying work-related education. 2011 irs form 8863 She took one course, which is one-fourth of a full course load of study. 2011 irs form 8863 She spent the rest of the time on personal activities. 2011 irs form 8863 Her reasons for taking the course in Michigan were all personal. 2011 irs form 8863 Sue's trip is mainly personal because three-fourths of her time is considered personal time. 2011 irs form 8863 She cannot deduct the cost of her round-trip train ticket to Michigan. 2011 irs form 8863 She can deduct one-fourth of the meals (subject to the 50% limit) and lodging costs for the time she attended the university. 2011 irs form 8863 Example 3. 2011 irs form 8863 Dave works in Nashville and recently traveled to California to take a 2-week seminar. 2011 irs form 8863 The seminar is qualifying work-related education. 2011 irs form 8863 While there, he spent an extra 8 weeks on personal activities. 2011 irs form 8863 The facts, including the extra 8-week stay, show that his main purpose was to take a vacation. 2011 irs form 8863 Dave cannot deduct his round-trip airfare or his meals and lodging for the 8 weeks. 2011 irs form 8863 He can deduct only his expenses for meals (subject to the 50% limit) and lodging for the 2 weeks he attended the seminar. 2011 irs form 8863 Cruises and conventions. 2011 irs form 8863   Certain cruises and conventions offer seminars or courses as part of their itinerary. 2011 irs form 8863 Even if the seminars or courses are work-related, your deduction for travel may be limited. 2011 irs form 8863 This applies to: Travel by ocean liner, cruise ship, or other form of luxury water transportation, and Conventions outside the North American area. 2011 irs form 8863   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. 2011 irs form 8863 50% limit on meals. 2011 irs form 8863   You can deduct only 50% of the cost of your meals while traveling away from home to obtain qualifying work-related education. 2011 irs form 8863 You cannot have been reimbursed for the meals. 2011 irs form 8863   Employees must use Form 2106 or Form 2106-EZ to apply the 50% limit. 2011 irs form 8863 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. 2011 irs form 8863 Example. 2011 irs form 8863 You are a French language teacher. 2011 irs form 8863 While on sabbatical leave granted for travel, you traveled through France to improve your knowledge of the French language. 2011 irs form 8863 You chose your itinerary and most of your activities to improve your French language skills. 2011 irs form 8863 You cannot deduct your travel expenses as education expenses. 2011 irs form 8863 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. 2011 irs form 8863 No Double Benefit Allowed You cannot do either of the following. 2011 irs form 8863 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). 2011 irs form 8863 Deduct work-related education expenses paid with tax-free scholarship, grant, or employer-provided educational assistance. 2011 irs form 8863 See Adjustments to Qualifying Work-Related Education Expenses , next. 2011 irs form 8863 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. 2011 irs form 8863 You must reduce the qualifying expenses by the amount of such expenses allocable to the tax-free educational assistance. 2011 irs form 8863 For more information, see chapter 12 of Publication 970. 2011 irs form 8863 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. 2011 irs form 8863 Amounts that do not reduce qualifying work-related education expenses. 2011 irs form 8863   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. 2011 irs form 8863   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. 2011 irs form 8863 Reimbursements How you treat reimbursements depends on the arrangement you have with your employer. 2011 irs form 8863 There are two basic types of reimbursement arrangements—accountable plans and nonaccountable plans. 2011 irs form 8863 You can tell the type of plan you are reimbursed under by the way the reimbursement is reported on your Form W-2. 2011 irs form 8863 For information on how to treat reimbursements under both accountable and nonaccountable plans, see Reimbursements in chapter 26. 2011 irs form 8863 Deducting Business Expenses Self-employed persons and employees report business expenses differently. 2011 irs form 8863 The following information explains what forms you must use to deduct the cost of your qualifying work-related education as a business expense. 2011 irs form 8863 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). 2011 irs form 8863 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. 2011 irs form 8863 See the instructions for the form you file for information on how to complete it. 2011 irs form 8863 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. 2011 irs form 8863 If either (1) or (2) applies, you can deduct the total qualifying cost. 2011 irs form 8863 If (3) applies, you can deduct only the qualifying costs that were more than your reimbursement. 2011 irs form 8863 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. 2011 irs form 8863 (Special rules for expenses of certain performing artists and fee-basis officials and for impairment-related work expenses are explained later. 2011 irs form 8863 ) 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. 2011 irs form 8863 See chapter 28. 2011 irs form 8863 Form 2106 or 2106-EZ. 2011 irs form 8863   To figure your deduction for employee business expenses, including qualifying work-related education, you generally must complete Form 2106 or Form 2106-EZ. 2011 irs form 8863 Form not required. 2011 irs form 8863   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. 2011 irs form 8863   If you meet both of these requirements, enter the expenses directly on Schedule A (Form 1040), line 21. 2011 irs form 8863 (Special rules for expenses of certain performing artists and fee-basis officials and for impairment-related work expenses are explained later. 2011 irs form 8863 ) Using Form 2106-EZ. 2011 irs form 8863   This form is shorter and easier to use than Form 2106. 2011 irs form 8863 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. 2011 irs form 8863   If you do not meet both of these requirements, use Form 2106. 2011 irs form 8863 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. 2011 irs form 8863 Include the cost of your qualifying work-related education with any other employee business expenses on Form 1040, line 24. 2011 irs form 8863 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. 2011 irs form 8863 You must complete Form 2106 or 2106-EZ to figure your deduction, even if you meet the requirements described earlier under Form not required . 2011 irs form 8863 For more information on qualified performing artists, see chapter 6 of Publication 463. 2011 irs form 8863 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. 2011 irs form 8863 They are not subject to the 2%-of-adjusted-gross-income limit. 2011 irs form 8863 To deduct these expenses, you must complete Form 2106 or 2106-EZ even if you meet the requirements described earlier under Form not required . 2011 irs form 8863 For more information on impairment-related work expenses, see chapter 6 of Publication 463. 2011 irs form 8863 Recordkeeping You must keep records as proof of any deduction claimed on your tax return. 2011 irs form 8863 Generally, you should keep your records for 3 years from the date of filing the tax return and claiming the deduction. 2011 irs form 8863 For specific information about keeping records of business expenses, see Recordkeeping in chapter 26. 2011 irs form 8863 Prev  Up  Next   Home   More Online Publications
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Non-filer Investigations - Criminal Investigation (CI)

Overview
Taxpayers who fail to file income tax returns and pay taxes pose a serious threat to tax administration and the American economy.

Who Must File
All citizens must comply with the requirements of the tax law to file returns and pay taxes.

Facts & Fiction of Frivolous Arguments
The 16th Amendment was ratified on February 3, 1913 giving Congress the power "to lay and collect taxes."

IRS Warns of Frivolous Tax Arguments
IRS issued Press Releases that summarize several cases where the taxpayer was fined or penalized for frivolous contentions.

Department of Justice Issues Injunction
The Department of Justice has issued several injunctions against promoters of illegal tax plans or shelters that urge taxpayer to violate the tax laws.

Statistical Data
Enforcement statistics on investigations initiated, prosecutions recommended, indictments, sentenced investigations and months to serve in prison.

Examples of Non-filer Investigations
Examples are written from public record documents filed in the district courts where the case was prosecuted.

 


Criminal Enforcement Home Page

How to Report Suspected Tax Fraud Activities

Page Last Reviewed or Updated: 30-Oct-2013

The 2011 Irs Form 8863

2011 irs form 8863 Publication 925 - Additional Material Prev  Up  Next   Home   More Online Publications