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DanielleCPA
DanielleCPA, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 789
Experience:  Years of Experience in Business & Personal Taxes
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My husband is in the military and is studying full time. His

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My husband is in the military and is studying full time. His degree is directly related to his job. We pay for his books, part of his tution and computer software required for his course. His taxable income is usually under $20000. Are we able to claim a learning credit for him this coming year or do we need to claim the costs as business expenses for work related eduction?
I work in a physical therapy office. One of the types of clothing we are allowed to wear are scrubs. Am I able to claim the cost of scrubs on our return?
I have heard of the 2% limit for deductions. Does that mean that if we claim my husband's education expenses as a business expense (if we are not able to claim an eduction credit) and the cost of my scrubs we can only claim up to 2% of our joint gross income?

DMC :

Hi and welcome to Just Answer! I'm happy to help with your tax questions. Feel free to interject at any time if you need clarification.

DMC :

Is your husband still in his first four years of college?

Customer:

Yes

Customer:

its his second year

DMC :

As long as he is in his first four years, he would qualify for the American Opportunity tax credit (AOTC) , which is more beneficial than the lifetime learning credit. At your income level, I think you would likely end up with very little taxable income so therefore very little tax. The lifetime learning credit is nonrefundable, so you can only use it to offset your tax. The AOTC is available up to a maximum of $2,500 and is refundable up to $1,000. This means that even if you don't owe any tax, you will get $1,000 of the credit as a refund.

DMC :

Work clothes and uniforms are deductible if they are required and not suitable for everyday use. If you are not required to wear scrubs, the cost is not deductible. Since you are not required to wear the scrubs but are only allowed to, you would not qualify for a deduction for uniform fees. The 2% limit is a percentage of income limitation -- you are only allowed to deduct certain deductions if they exceed 2% of your adjusted gross income. On top of that, uniforms are an itemized deduction, so your total itemized deductions (mortgage interest, property tax, charity, medical expenses) must exceed $11,600 to be able to receive a benefit.

Customer:

Okay. I understand about the education credit. Thanks for that. We had to buy a new laptop, partly for his school and partly for his work as he needs to have access to secure sites for work while his is deployed. Are we able to claim the cost of that as business expense or would that also be something that would be one of the itemized deductions you mentioned?

DMC :

Yes, a new laptop purchased for work would fall under the category of itemized deductions. Also, in order to be deductible, the laptop would have to be 100% used for work with no personal or school use.

Customer:

okay. Thank you.

DMC :

Not a problem. You're very welcome. If you have any follow-up questions, please ask them. If not, please hit the green accept button if you are satisfied with my answer.

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