Save your cash register receipt when buying school supplies. Here’s why.
Every notebook, pen, and graphing calculator you buy just might lower your eventual state tax bill—even if you have a very high income.
In some states, such as Minnesota, K-12 school supplies and other expenses qualify for an “education subtraction,” which can mean money in your pocket. An “educational subtraction” means that you get to subtract school-related expenses from your taxable income on your state income tax return. This can mean less tax for you, even if you’re from a very wealthy family.
But wait; look at these other school expenses that may also reduce your taxable income!
Save all of your receipts and invoices from:
- Music lessons
- Purchase or rental of musical instruments
- Fees paid for after-school classes and instruction such as science exploration, dance or art lessons, and study habits courses
- Fees paid for academically oriented summer classes
- One-on-one tutoring by a “qualified instructor” *
- Expenses paid for field trips including entrance fees to exhibits
- Tuition for academic summer camps such as language or fine arts camps
- Fees paid for all-day public school kindergarten
- Instructor fees for driver’s education courses
- Text books, academic books, and materials purchased for use during the regular public, private or homeschool day as long as they are nonreligious in nature
- Fees paid to others for transportation to/from school or for field trips during the normal school day
- Private school tuition
- Tuition for college courses that are used to satisfy high school graduation requirements
- $200 worth of the home computer hardware you purchase in a given year including printer, monitor, modem, additional hard drives, and memory upgrades as long as that computer is not also used for a trade or business
- Educational software
- Gym clothes required for gym class
- Money paid for school supplies used either at home or at school including pens, pencils, highlighters, notebooks, folders, rulers, erasers, and calculators.
* A “qualified instructor” is a person with at least a baccalaureate degree who is not the student’s parent, grandparent, or sibling. The baccalaureate degree need not be in the field the instructor is teaching.
These expenses may reduce your taxable income—up to $2,500 per child per year. This can really add up.
The rules vary from state to state. Call your state’s department of revenue to find out what the rules are where you live.
The listed items definitely qualify for “subtraction” in Minnesota, where I live. (You can see the actual Minnesota Department of Revenue Fact Sheet on this subject here. If you’re from a different state, Google “department of revenue phone” and the name of your state. Ask: “Does our state have an ‘educational subtraction” or “education tax credit’ for K–12 school expenses? Can you help me find a fact sheet on that?”
Don’t bother carrying around messy paper receipts; use Evernote®.
Evernote® is a lifesaver for keeping track of details. Evernote® is a “cross-platform, freemium app designed for note-taking, organizing, and archiving.” Evernote® will allow you to take a photo of any receipt and instantly record it in a digital “notebook” where it’s easy to retrieve later. You can do this in seconds, and then throw the receipt away.
You might as well start doing this now; you’ll need to keep track of education expenses later, anyway, so you can prove that money you’re pulling out of your child’s 529 college savings plan is indeed going for “qualified educational expenses.”
Would you like to learn more about Evernote®? Here’s a great resource.
Michael Hyatt provides excellent free guidance for using Evernote® here.
Do you work at a K–12 school or at a tutoring company such as Sylvan Learning Center? Do you teach music, dance, driver’s ed, or an academic summer program of any kind?
Save this post—and then share it with all the families you serve by posting it on your organization’s website, in your school newsletter, and on social media.
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Who is Jeannie Burlowski?
Jeannie is a full-time academic strategist, podcast host, and sought-after speaker for students ages 12–26, their parents, and the professionals who serve them. Her writing, speaking, and podcasting help parents set their kids up to graduate college debt-free, ready to jump directly into careers they excel at and love. Her work has been featured in publications such as The Huffington Post, USA Today, Parents Magazine, and US News and World Report, and on CBS News.
This article was updated on July 12th, 2023. No part of this article was written using AI.