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I work for a foreign-based company from my home in a sales

role. My company reimburses me...
I work for a foreign-based company from my home in a sales role. My company reimburses me for specific expenses, such as mileage, customer entertainment, etc. If I take a online course which is for the betterment of my career by a reputable company which is not a education institution (and which my company will not reimburse me for), can I deduct the entire cost of this class from my taxes? (This is quite a expensive course, close to 5% of my annual income). Additionally If I join a shared office space outside my home, which is also not reimbursable by my company, can I deduct this yearly cost as well?
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Answered in 3 minutes by:
11/13/2013
Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 15,886
Experience: 15years with H & R Block. Divisional leader, Instructor
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Robin D. :

Hello and thanks for trusting me to help you today. I am a tax adviser with over 15 years of experience.
If you read the tax laws online then you must have come across the rules that state:
To be deductible, your expenses must be for education that (1) maintains or improves your job skills, or (2) is required by your employer or by law to keep your salary, status or job. However, even if the education meets either of these tests, the education cannot be part of a program that will qualify you for a new trade or business, or needed to meet the minimal educational requirements of your trade or business.

If you are an employee then you would use the Schedule A and form 2106 to claim he costs under the 2% limit rules.
If you are reporting as self employed then it is on your Schedule C.

Robin D. :

If you conduct business at a location outside of your home, but also use your home substantially and regularly to conduct business, you may still qualify for the home office deduction.
Rent is any amount you pay for the use of property you do not own. In general, you can deduct rent as an expense only if the rent is for property you use in your trade or business. If you have or will receive equity in or title to the property, the rent is not deductible. So the office would be an expense as long as it is used for business.

Robin D. :

My goal is to give you excellent service. If you are satisfied, please rate me. If you have follow-up questions on this same topic, use the reply box below. To start a new conversation with me on a new topic request me again.

Robin D. :

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Customer reply replied 4 years ago

Robin-


 


Thanks for the answer, I would like to ask a few clarifications. According to the verbage in the tax law the education I would like to take would qualify for reimbursement, however I'm concerned about the 2% limit referenced. If say I make $100,000 per year does this mean I can only deduct $2,000 for educational expenses total per year?


 


Additionally I've always been very confused (obviously!) about deductions for a person who works from home, however is employed and reimbursed for certain expenses by their employer. Is there a resource/site which explains this in relatively plain english? Right now I deduct nothing for working at home


 


Thanks again for the great service!

Hi,
The 2% limit means that if your adjusted gross income is $100,000 then 2% of that is $2000, so you would only be able to truly use the amount that is over $2000 of the deduction. This means that if your expense is $3000 the true deduction is $1000.

If you are reimbursed by your employer then you do not claim that amount as a deduction (unless the reimbursement is a part of your taxable wages.
The best source is generally the IRS:
http://www.irs.gov/uac/Employee-Business-Expenses-1
Robin D.
Robin D., Senior Tax Advisor 4
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