OBBBA Revamps and Enhances Educator Expense Deductions

Educator Expense Deductions

For 2025, you can claim an “above-the-line deduction” for so-called educator expenses.

The above-the-line deduction reduces your adjusted gross income (AGI) and that’s a good thing.

The bad thing is that the 2025 law limits the educator expense deduction to $300.¹ Money spent by the educator in excess of $300 is not deductible because the excess is one of those disallowed 2 percent miscellaneous itemized deductions.²

Eligible Educator (2025)

The term “eligible educator” means, with respect to any taxable year, an individual who is a teacher, instructor, counselor, principal, or aide in a school for children anywhere from kindergarten through grade 12, for at least 900 hours during a school year.³

School (2025)

The term “school” means any school which provides elementary education or secondary education (anywhere from kindergarten through grade 12), as determined under state law.⁴

Allowable Expenses (2025)

An eligible educator may—by reason of their participation in professional development courses related to the curriculum in which the educator provides instruction, or related to the students for which the educator provides instruction—deduct the following if used by the educator in the classroom:⁵

• Books

• Supplies (other than non-athletic supplies for courses of instruction in health or physical education)

• Computer equipment (including related software and services)

• Other equipment

• Supplementary materials

2026 Changes and Enhancements OBBBA Revamps and Enhances Educator Expense Deductions

Starting in 2026, the OBBBA⁶

• keeps the $300 above-the-line deduction in place;

• removes educator expenses from the disallowed 2 percent miscellaneous itemized deduction category;

• makes educator expenses in excess of $300 deductible as itemized deductions (below-the-line, requiring itemizing to benefit);

• allows athletic supplies for courses of instruction in health or physical education;

• substitutes “as part of instructional activity” for “in the classroom”; and

• adds interscholastic sports administrators and coaches as eligible educators.

Example. Sally, an 11th-grade teacher, pays $1,400 for a classroom projector in 2026. She deducts $300 on Schedule 1 (above-the-line) and, because she itemizes, deducts the remaining $1,100 on Schedule A. This is a vast improvement over 2025.

Tax Planning

This OBBBA change will do you no good unless you have itemizable deductions that exceed your allowable standard deduction.

As a reader of our material, you know that the OBBBA potentially increases your allowable state and local tax (SALT) deduction, making it more likely that you can itemize.

Whether you are limited to the $300 deduction or you have educator expenses that you can itemize, make sure to keep receipts for your educator expenses.

Educator Expense Deductions

Takeaways

For 2025, educators can claim an above-the-line deduction of up to $300 for classroom-related expenses, but anything beyond that is not deductible.

Starting in 2026, the OBBBA makes this deduction far more beneficial: it keeps the $300 above-the-line write-off while also allowing additional educator expenses as itemized deductions, expanding eligible costs, and broadening who qualifies as an “educator.”

The key planning point is that these enhancements matter only if your total itemized deductions exceed the standard deduction—so track expenses carefully, and consider whether itemizing will maximize your tax benefit.

OBBBA Revamps and Enhances Educator Expense Deductions

References

1. IRC Section 62(a)(2)(D); Rev. Proc. 2024-40

2. IRC Sections 67(h); 67(a)

3. IRC Section 62(d)(1)(A)

4. IRC Section 62(d)(1)(B)

5. IRC Section 62(a)(2)(D)

6. OBBBA makes no change to IRC Section 62(a)(2)(D). See One Big Beautiful Bill Act (P.L. 119-21), Section 70110.

By:W. Murray Bradford, CPA

Publisher

Tax Reduction Letter

www.bradfordtaxinstitute.com