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licensing supervision and fees

My wife is currently a school psychologist and is endeavoring to become licensed. Becoming licensed will not advance her current career in the public school system but will allow her to explore other options outside of the public school setting.

As part of the requirements of becoming licensed she must be supervised by a licensed psychologist, who in this case will be charging for her time (>$600 over the year).

Can and how would we deduct these payments on our 2008 tax return? Would we need to issue a 1099? Even if the answer to the first question is no? Are the exam fees deductible?

Thanks.

Reply to
Brian Attwood
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We'd need more information, but it is very likely that there is NO deduction here (sorry).

The rules for deductibility are pretty clear - IF the education or associated costs QUALIFY you for a NEW occupation then you get no deduction.

For example, as a tax accountant, if I went to law school to become a tax attorney - even though I'd still work in the tax field and I'd still be an owner of the business, I get no deduction because the law degree qualifies me to work as an attorney.

For your wife, if the licensing will qualify her for NEW work, there should be no deduction. I'd suggest you start by visiting

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and read through thepertinient parts. I'd also stronly encourage you to contact a localtax pro to review your situation. Gene E. Utterback, EA, RFC, ABA

Reply to
eagent

Right. But if it's the same occupation at a higher level in a new context, I'd think it might qualify. She's already a school psychologist. She wants to become qualfied to work as a psychologist with private clients.

So if you do something that advances you in your career, but coincidently happens to qualify you for different work then it is not deductible? I haven't researched this lately, but it seems a little harsh.

Stu

Reply to
Stuart Bronstein

Technically, the law degree does not qualify you to work as an attorney. Passing the state bar exam does. I doubt the IRS will appreciate the distinction.

Reply to
Gil Faver

(snipped...)

As an adjunct of this response, suppose Gene went to law school solely for the purpose of taking courses that might help in the practice of tax accounting, e.g. business law comes to mind.

Guess what? IRS says no deduction since part of law school course.

But if he took similar course in business law at local university, then yes.

Talk about "strange"!

ChEAr$, Harlan Lunsford, EA n LA

Reply to
Harlan Lunsford

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text -

CORRECT - without question.

Gene E. Utterback, EA, RFC, ABA

Reply to
eagent

It seems harsh because it's TRUE.

Reply to
D. Stussy

In addition to the other responses, did you check out the lifetime learning credit at ? Not sure if you could use it, but it's worth a shot. BTW, even if you could deduct the learning fees, it would be subject to the 2% limit, which means it might be no benefit at all (combine all job and certain misc expenses; only the amount over 2% of your AGI is deductible).

Reply to
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