Tax Season. Two words most rehab professionals don't like hearing. This time of year can mean piled up receipts and documents to see how one can wrangle back some of their hard earned money from Uncle Sam. Looking for deductions, many professionals use a similar formula - mortgage interest, donations, and those never ending student loans - to squeeze out a refund. Yet, many of us forget that a nice bit of money can be gained from something most of us already do – continuing education.
Recently, I had a debate with colleagues about what qualifies as a write off with a continuing education opportunity. I followed up with my accountant and also went to the IRS website . I came away with some information that I thought other professionals may find useful. These are helpful hints, but always discuss them with a tax attorney, accountant, or the IRS prior to taking them on. Here are some thoughts :
First, and a surprise to hardly any of us, continuing education can be written off. The rules:
1. Qualifying work related education can be written off if the continuing education is required by your employer or the law to maintain your current job. In most States CEUs this is a requirement! In California for example, a PT is responsible for 30 hours of Cont Ed every 2 years. ( Click here for your state's requirements.)
2. Qualifying education can be written off if the course maintains or improves your skills needed in your present work. This could possibly apply for many experienced PTs whom are seeking their Transitional DPT degrees for example.
The above rules essentially enable many of us to take continuing education classes for a write off. However, if you were to take courses to switch careers or positions then this may not serve as a write off.
Second, what can be written off when I sign up for a course? I think rehab professionals, including myself, overlook many deductible expenses. Per the IRS website:
1. Deductions can be taken off for tuition, books, supplies, and certain transportation, travel, and lodging costs.
- In regards to transportation, any use of your car to your school or course can be deducted at an average rate of $0.54 mile (as of April 2017).
2. Deductions for meals can also be taken during the course at a rate of 50% of the price of the meal.
This blew me away. For example, if I took a course in New York, I could potentially pay for the course, flight, transport and meals and take deductions. Awesome!
However, there are specific limitations that the IRS discusses nicely on their site. First, you can’t take a spouse or significant other with you and deduct their expenses. Second, you can’t fly somewhere and spend time much longer than the course and write the whole trip off. For example, if I spent an entire month in New York and only took a 3-day course. Per the IRS, the focus of your trip should be the course.
With all the above information, I reflected back on my past courses where I opted to drive, but never deducted mileage, or stayed with friends to save on hotel or AirNB fees. I also never thought of supplies (IASTM tools anyone?) or books ( that signed copy of Explain Pain from Lorimer Moseley and David Butler).
Having this knowledge, I plan to further discuss continuing education with my accountant, but also pursue courses in areas where I can learn, network, and hopefully see some places I’ve not yet traveled to. I may even look into helping other professionals by starting a continuing education company that may provide some of these benefits….oh wait…I did!! Happy Tax season everyone…we hope to see you soon at a JetSet Rehab Education course and invite you to Stay after Class!
Jiten B. Bhatt DPT, OCS is Co-Founder of JetSet Rehab Education and a published author in JOSPT.
and write it off :)