Can I Deduct a Dance Tuition From My Federal Taxes?
Whether dance instruction is related to college, business or fun makes a difference to your taxes.
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Dance can be a beautiful thing to watch, and it may look even better at tax time. If you, your spouse or your kids are taking dance classes in college, the IRS offers several ways to write off part of the tuition. You're out of luck, though, if you or your family members are taking ballroom dancing in the evenings. Taking classes for fun isn't deductible.
Tax Credits
You can use the American opportunity or lifetime learning credits to take some of the costs of college tuition right off your taxes. American opportunity cuts up to $2,500 off your tax bill. Lifetime learning cuts $2,000. You can't claim them both for the same student in the same year. The credit is good for studies at any two- or four-year college or vocational school that qualifies to participate in federal student aid programs. With Lifetime learning, tuition is deductible only if the class is part of a degree program or taken to acquire or improve job skills.
Straight Deduction
If you don't qualify for the tax credits for any reason, you can still write off tuition on your Form 1040. You report tuition as an adjustment to gross income, so you can claim the write-off even if you don't itemize. The deduction lets you write off up to $4,000 in tuition expenses for the year. You can claim the deduction for tuition at any post-secondary school that can get federal aid. The school administration can tell you whether it qualifies.
Classes as Child Care
College is one thing, summer camp or after-school dance classes another. Whether they're for fun or because your son dreams of being a dancer someday, they don't usually earn you a write-off. The exception is if you use them as child care so that you and your spouse can work or look for work. You can take up to $3,000 in expenses as a tax credit, or $6,000 for two or more kids.
Professional Performers
If you're earning a living doing something that includes dancing, it's a whole new ballgame. Your expenses are now business expenses, deductible on Schedule C. That includes the cost of classes and other training, dance leotards, tap shoes, and mileage to classes or performances. You can do this even if dance is only a part-time thing. If you spend more than you earn, though, the IRS can declare dancing is just a hobby. You still report your income, but you claim deductions by itemizing on Schedule A and you can deduct your expenses only to the extent they exceed 2 percent of your adjusted gross income.
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Writer Bio
A graduate of Oberlin College, Fraser Sherman began writing in 1981. Since then he's researched and written newspaper and magazine stories on city government, court cases, business, real estate and finance, the uses of new technologies and film history. Sherman has worked for more than a decade as a newspaper reporter, and his magazine articles have been published in "Newsweek," "Air & Space," "Backpacker" and "Boys' Life." Sherman is also the author of three film reference books, with a fourth currently under way.