Maximize Deductions for Your Educational Business
Whether you are teaching math at a student's kitchen table or teaching English via Zoom to students overseas, you are running a business. To lower your tax bill, you must track every "ordinary and necessary" expense used to educate your clients.
📚 Curriculum & Teaching Materials
- Textbooks & Workbooks: Books purchased for lesson planning or for students to use.
- Supplies: Paper, pens, pencils, markers, dry-erase boards, and flashcards.
- Manipulatives: Math blocks, science kits, musical instruments (for music teachers), or props (puppets/rewards) for online teaching.
- Printing: Ink cartridges, printer paper, and lamination costs for worksheets.
- Digital Resources: Purchases from Teachers Pay Teachers or subscriptions to education sites (IXL, Kahoot, Raz-Kids).
💻 Technology & Online Teaching
- Hardware: Laptop, tablet (iPad), webcam (high quality), and noise-canceling headset.
- Lighting: Ring lights or softbox lighting used for video lessons.
- Background: Maps, posters, or green screens used to set up your teaching environment.
- Software: Zoom Pro subscriptions, scheduling software (Calendly), or lesson planning apps.
- Internet: Business percentage of your high-speed internet bill.
🚗 Travel (For In-Person Tutors)
- Mileage: Miles driven from your home office to a student's home, the library, or a coffee shop. (Standard Mileage Rate: ~70.5 cents/mile).
- Commuting Rule: If you do not have a home office, the drive to your first student of the day might be considered non-deductible commuting. However, driving between Student A and Student B is always deductible.
- Parking: Parking fees at libraries or public venues.
📢 Marketing & Platform Fees
- Platform Fees: If you work through Wyzant, Outschool, or Varsity Tutors, they take a commission (often 20-30%). This is a deductible business expense.
- Tax Tip: Your 1099-K usually shows the Gross amount (what the parent paid). You must deduct the platform fee to find your actual taxable income.
- Advertising: Website hosting, business cards, flyers posted at schools, or Facebook ads.
- Background Checks: Fees paid to run your own background check to provide to parents.
🏠 Home Office
- Dedicated Space: If you tutor students in your home or teach online from a specific room, you can deduct a percentage of rent/mortgage and utilities.
- The "Exclusive Use" Rule: The space must be used only for tutoring. If you teach at the kitchen table where you also eat dinner, you generally cannot take the Home Office Deduction.
🎓 Professional Development
- Certifications: Fees for state teaching license renewals or specialized certifications (e.g., TEFL, TESOL).
- Memberships: Dues for professional organizations (e.g., National Tutoring Association).
- Continuing Ed: Classes or workshops taken to improve your teaching skills in your subject area.
⚠️ Important Compliance Note
- Agency Status (W-2 vs. 1099): If you work for a large tutoring center (like Sylvan or Kumon), you are likely a W-2 Employee. In that case, you generally cannot deduct these expenses. This cheat sheet is for Independent Contractors.
- Student Gifts: You can deduct up to $25 per student per year for gifts (e.g., a book or gift card for completing a level).
- Sibling Discounts: If you offer a discount for siblings, you don't "deduct" the discount. You simply report the reduced income you actually received.
Disclaimer: This list is for educational purposes and does not constitute legal or tax advice. Deductibility depends on your specific business structure. Please consult with KJC Tax Preparation & Bookkeeping to confirm your eligibility.