Educators May Deduct PPE Expenses Under New IRS guidelines

Last week, the IRS released Rev. Proc. 2021-15 as an update for the deductibility of personal protective equipment (PPE) paid for by educators. The new update provides a safe harbor for “eligible educators” to treat unreimbursed expenses for PPE paid out of pocket by the educator.

According to the IRS, “this revenue procedure provides a safe harbor for eligible educators, within the meaning of § 62(d)(1) of the Internal Revenue Code (Code), to treat unreimbursed expenses paid or incurred after March 12, 2020, for personal protective equipment, disinfectant, and other supplies (COVID-19 Protective Items) used for the prevention of the spread of COVID–19 in the classroom, as expenses that are described in § 62(a)(2)(D)(ii) and allowable as a deduction under § 62(a)(2)(D) pursuant to section 275 of the COVID-related Tax Relief Act of 2020 (COVID Tax Relief Act), which was enacted as part of the Consolidated Appropriations Act, 2021.”

PPE that is labeled as deductible includes:

· Face masks;

· Disinfectant;

· Hand soap;

· Hand sanitizer;

· Disposable gloves;

· Tape, paint, chalk, etc. that is used to enforce social distancing;

· Physical barrier (i.e plexiglass);

· Air purifiers; and

· Any other items recommended by the CDC to prevent the spread of COVID-19

Sec. 62(a)(2)(D) allows eligible educators an above-the-line deduction of up to $250 of qualifying expenses per year ($500 if married filing jointly and both spouses are eligible educators, but only $250 each). Under Sec. 62(d)(1)(A), an “eligible educator” is any individual who is a kindergarten through grade 12 teacher, instructor, counselor, principal, or aide in a school for at least 900 hours during a school year. For these purposes, a school is any school that provides elementary or secondary education under state law (Sec. 62(d)(1)(B)). The professionals at The Center for Financial, Legal, and Tax Planning, Inc. are more than knowledgeable with regards to reducing your tax burden using valuable deductions. Please contact us at (618) 997-3436 for more information.