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SOI Tax Stats - Income from Trusts and Estates Statistics

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Snapshot of Estate and Trust Income Tax Statistics

The U.S. Income Tax Return for Estates and Trusts (Form 1041) is used to report the income, deductions, gains, and losses of estates and trusts, as well as distributions to beneficiaries and income tax liability. Entities are classified into types based on their purpose. These types include:

  • decedent's estates
  • simple trusts
  • complex trusts
  • qualified disability trusts
  • electing small business trust (ESBT)
  • grantor type trust
  • bankruptcy estates
  • pooled income funds

For information about selected terms and concepts, a description of the data sources and limitations, and links to recent revisions of Form 1041, please visit Income from Trusts and Estates Study Metadata.
 

Statistical Tables   SOI Bulletin Articles       Other IRS Data
 

 


Statistical Tables

The following tables are available as Microsoft Excel®  files.  A free Excel viewer is available for download, if needed.

Fiduciary Returns - Sources of Income, Deductions, and Tax Liability, by Tax Status and Size of Gross Income

Fiduciary Returns - Sources of Income, Deductions, and Tax Liability, by Type of Entity

Fiduciary Income and Deductions, by State and Entity Type

 

Archive - Fiduciary Income Tax Returns
 

To make customized tables using this data, please visit the Statistics of Income Tax Stats Table Wizard.

 

Projections

For selected tax returns, including the Form 1041, IRS's Office of Research produces annual forecasts of the number of returns that will be filed in future years.
    Projections of Returns to be Filed in Future Calendar Years


 

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SOI Bulletin Articles

The following are available as PDF files.  A free Adobe® reader is available for download, if needed.

 

  • Fiduciary Income Tax Returns

               2003-2004          1997          1982

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Other SOI Data on Trusts

Form 5227 is an information return filed by split-interest trusts, those who make distributions to both charitable and noncharitable beneficiaries, while providing tax benefits to their donor.  Certain charitable trusts, those treated as private foundations except that they are not exempt from income taxes, annually file Form 990-PF.

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Other IRS Data and Related Links

For tax administration data on this topic, as well as other types of taxes, choose from the links below.

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Page Last Reviewed or Updated: 06-Jan-2014

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