Piano Teacher

[AccTaxMan]

Self-employed piano teacher attends a graduate program (master degree) in piano (or a music major in general and related to piano). She questions if she can claim the tuition fees as a business expense on her Schedule C. How would you determine if it is a legitimate business expense?

I am thinking how to respond to her question. At this time, I think a good question to ask her is "Is it necessary to have the master degree or the knowledge taught in that degree program in order to continue your current piano teaching business". Any advice or opinion?

[ChEAr$]

Self-employed piano teacher attends a graduate program (master degree) in piano (or a music major in general and related to piano). She questions if she can claim the tuition fees as a business expense on her Schedule C. How would you determine if it is a legitimate business expense?

I am thinking how to respond to her question. At this time, I think a good question to ask her is "Is it necessary to have the master degree or the knowledge taught in that degree program in order to continue your current piano teaching business". Any advice or opinion?

Now that's a tough call all right.

IF.... If she teaches at Julliard or Eastman, or some higher level of keyboard instruction,
definitely yes.

But if her pupils are youngsters, below high school level, I don't think so.
Unless one of those youngsters is really a child prodigy.

[travis bickle]

So you think that

Now that's a tough call all right.

IF.... If she teaches at Julliard or Eastman, or some higher level of keyboard instruction,
definitely yes.

But if her pupils are youngsters, below high school level, I don't think so.
Unless one of those youngsters is really a child prodigy.

she would have to have a child prodigy in order to qualify for "upgraded education in her field of endeavor?"

What if someone worked as a self-employed CPA? Would s/he need a multi-million dollar client in order to take additional coursework towards an MBA?

Simply apply the tests given by the IRS [i.e., required for current job; related to current work; train her for a new field, etc, etc].

Definitely a Sch C entry.

[thomtax]

I agree with Travis. Just run through the IRS rules to determine. You never know when the additional education might sway some parents towards using her as a teacher for their child. You may be doing what I am often guilty of doing. Many times I catch myself over thinking a situation until someone points out my error and I think - of course.

LT

[gkaiseril]

If she has established herself in a business as a piano teacher after graduating from college, it is a business deduction. But be sure to check the education credits or the combination of credit and business expense to see what provides the lowest taxes.

Also document that the taxpayer is not pursuing a teaching position in a school or university.

[ChEAr$]

she would have to have a child prodigy in order to qualify for "upgraded education in her field of endeavor?"

What if someone worked as a self-employed CPA? Would s/he need a multi-million dollar client in order to take additional coursework towards an MBA?

Simply apply the tests given by the IRS [i.e., required for current job; related to current work; train her for a new field, etc, etc].

Definitely a Sch C entry.

but still subject to the "ordinary and necessary" tests, right?

On that I based my answer.

In a similar vein, I AM a tax accountant with a mostly local practice (except for clients in NC, WA, IL, FL, etc) A course in international taxation relates to tax accounting. But I would be loath to take a deduction for such a course since it's not appropriate for my work.

[Lion]

Applies

Of course, it applies to your work. Your next client in AL might have moved from England, have rental property in France, and run a business importing fabric from India. Now, if you took a course in dental hygiene, I'd say that could qualify you for a new trade and not deductible on Sch C, only as LL or whichever benefit fits your circumstances.

[DaveO]

ChEAr$ I wouldn't hesitate to deduct a course in international taxation. While my usual clients has no international dealing beyond a foreign tax credit from a mutual fund I've had sales of property overseas and missionaries to take care of too.

A few law classes won't equip you to be a lawyer but they will help you to interpet tax law and better represent clients in appeals. I would take a deduction for those classes as well.

[Burke]

Think of it this way. If an employee (W2) who itemizes can take the deduction for a Masters in their current field of work on Sche A, why wouldn't a self-employed person be able to do the same thing. Just no 2% haircut. "Used to improve their skills...."

[ChEAr$]

Think of it this way. If an employee (W2) who itemizes can take the deduction for a Masters in their current field of work on Sche A, why wouldn't a self-employed person be able to do the same thing. Just no 2% haircut. "Used to improve their skills...."

Now that you mention that case, yes, I did deduct the cost of certain MBA courses (but not all) while I was employed and doing certain financial forecasting work.

But in my case here in my present station in life I have no intention of ever taking
on any clients with international interests, so no deduction for me.
Not even on the chance that I might get one in the future and change my mind.

[erchess]

Personal View Here

I think all of us struggle with when education is for the same trade or business and when it prepares the person for a new trade or business. I think we struggle because there are few if any really bright lines. Back in the 90s I think it was a Virginia teacher of high school social studies was allowed to claim the expenses of getting a law degree treated as employee business expenses based on the fact that the State accepted the courses as CEUs toward certificate renewal and he stated that he had no interest in practicing law but only wanted to be able to tell his students what the law is and how it has developed over time.

The Federal Government produces a multivolume "Dictionary of Occupational Titles" but I have never heard of its being referenced in a tax case, It attempts to define all possible occupations currently practiced in the US and explain for each the necessary training and experience to get in as well as information about how many are in the occupation now and how many more or fewer are expected to be needed in the future, the income people in the field earn, and so on.

To my mind, in the field of music, performing for pay, teaching at a college university or conservatory, teaching at the K-12 level and giving private lessons to learners functioning at a non professional level are different trades or professions. All of the people I know in the latter category have at least college work in music and most have or are working on Master's Degrees so I would have no qualms about letting the person in OP claim his coursework on Sch C as long as he told me he was not looking to move into one of the other occupations.