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Taxpayers Must Meet Strict Requirements for Continuing Education Expense Deductions

Key point. Continuing education expenses that are part of a program of study that will lead to qualifying a taxpayer in a new trade or business are not deductible as a business expense even if the taxpayer did not intend to enter that trade or business.

The Tax Court denied a taxpayer's deduction for continuing education expenses because he failed to meet the strict requirements of the tax code. A physician claimed a business expense deduction on his tax return for flight lessons that would enable him to provide medical services to persons in remote areas. The IRS denied the deduction, and the taxpayer appealed. The Tax Court observed:

Section 162 [of the tax code] allows a deduction for all ordinary and necessary expenses paid in carrying on a trade or business. Section 162 does not explicitly provide for a deduction for continuing education expenses, but such expenses may be deductible ...

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  • April 21, 2016

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