Republicans in the House would scrap the writeoff, but their Senate counterparts would double it.
Teachers who use their own money for classroom supplies could lose a tax break under the Republican legislation wending its way through Congress.
The tax code currently allows educators to subtract what they’ve spent on teaching expenses ― up to $250 ― from their gross income. The tax bill that Republicans pushed through the House of Representatives earlier this month would scrap the deduction.
The teacher tax writeoff is very small, costing about $2 billion, but also very symbolic. It’s one of several deductions Republicans would eliminate to simplify the tax code and also to offset the revenue loss from the big tax cuts they’re proposing for corporations and wealthy individuals.
Both the House and Senate tax bills reduce marginal tax rates while eliminating a plethora of deductions, meaning some households will see more of their income subject to taxation. That’s why experts who’ve analyzed the legislation find it would reduce taxes for most, but not quite all, households, despite Republican claims that everyone would be better off.
But there are differences between the House bill and the Senate version, which could see a vote on the Senate floor this week. Rather than eliminate the educator deduction, the Senate bill would double it to $500, reducing taxes on teachers by $1.5 billion over a decade. The two chambers must ultimately agree on the same legislation before it can go to the president’s desk.
The writeoff for educator expenses is an “above the line” deduction tax filers can use to reduce their adjusted gross income, and therefore the amount of money subjected to taxes each year, regardless of whether they take the fixed standard deduction or go with itemized deductions for things like mortgage interest payments and charitable donations.
Suzanne Engel, a speech and language pathologist who works at a public school in St. Louis, said that in her 30-year teaching career she has typically spent about $500 annually on items she needs to do her job.
“I have to buy things like just basic supplies, like pencils and crayons and markers,” Engel said.
Engel said she’s not sure if she would be better off with the lower tax rates in the Republican legislation, since she and her husband have taken itemized deductions for mortgage interest payments and state and local taxes. The House plan eliminates the state and local income tax deduction, though it would still allow a deduction for up to $10,000 in property taxes.
The Republican tax bills touch education policy in a variety of ways. If higher earners lose the ability to deduct state income taxes, and opposition to those taxes grows, it could jeopardize an important source of funding for public schools, according to the liberal Center on Budget and Policy Priorities. Both bills would impose a tax on university endowments, and the House bill would count tuition reductions for some students as income subject to tax.
Engel lives in St. Charles, Missouri, where President Donald Trump will deliver a speech in favor of tax reform on Wednesday. Engel said she has appreciated the educator expenses deduction, even though it’s not worth much.
“At least I feel like the government is acknowledging that teachers do spend money out of their pockets,” she said.