JoeyDVivre Wrote: ------------------------------------------------------- > thepinkman Wrote: > -------------------------------------------------- > ----- > > “Just for discussion”…what if you’re being > > reimbursed and you then go ahead and claim it > on > > your taxes. Would the IRS know you were > > reimbursed? > > Then you would be committing blatant tax fraud and > you would get munched. Serioulsy man, you talking $990 deduction. That would maybe equal ~$300 savings on taxes. That is a drop in the bucket if you get audited. Those letters from the IRS get real nasty. If you are trying to defraud them, and get caught, you will most likey need to hire whats known as an Enrolled Agent to reprsent you in front of the IRS and those agents aer not cheap. It’s not worth double dipping.
The IRS website is pretty helpful in these matters: http://www.irs.gov/publications/p970/ch12.html#d0e11500 Joey did a good job of summarizing. Note: if you are not self-employed, this is an itemized deduction and is of the 2% of AGI floor variety, meaning you have to subtract 2% of AGI from your combined miscellaneous deductions before you can deduct.
Turkish Wrote: ------------------------------------------------------- > “Do you have your reciepts? If not, you would be > F** in an audit. And an audit is the last thing > you ever want. I saw some nasty ones at this > place.” > > On my return CRA referenced the CFA and said it > would allow the deduction. Why would I not have > my receipts? If not I guess we’ll share the same cell.
Ok, After futsing with the Pub 17, I thought I would bring this to the board. Does the CFA fall under the Lifetime Learning Credit? http://www.irs.gov/publications/p970/ch03.html#d0e3631
Wouldn’t this be a good question to ask CFAI? I mean this is something they should know right?
I’ve considered that, but so many places are programmed to say, “Please consult a tax advisor for specific tax advice.” I may just have to though.
Remember that there is no statute of limitations on tax fraud. If they don’t find out about mistakes in 7 years (maybe reduced to 5 now, but not 100% sure on that), you’re off the hook. If they feel you’ve been deliberately defrauding them, they can go back practically to when you were in the womb.
It is not my intention to defraud the IRS, I’m curious if the CFAI qualifies as an educational institution and therefore I can utilize the Lifetime Learning Credit.
The fraud bit was about claiming something as a deduction when in fact your employer has reimbursed you. I think CFA deductions it’s a legitimate gray area that can vary on a case-by-case basis. The point about saving $300 not being worth an audit is well taken. If the audit comes, you’d easily give back that $300 (or 3x$300) to avoid the hassle.
Being I do not itemize, the 2106 form for business educational expenses does not benefit me. However, the Lifetime Learning Credit may work IF the CFAI qualifies as an educational facility. This would yield about a $200 credit against what I owe. But as I posted earlier, I do not want any appearance of lets say, an income tax inconsistency :-), that results in a letter from the IRS. I’ll go ahead and contact the CFAI and see if they can be of help. After looking into in greater, I do not think I will part take.
JoeyDVivre Wrote: ------------------------------------------------------- > So you need to be in finance now for it to be > deductible then you need to meet one of two > “positive criteria”. Either: > > a) Your boss requires it from you and doesn’t > cover all your expenses. > or > b) It will improve your ability to do your current > job. > > Proving either A or B should be pretty easy. I > think this is quite different from CPA expenses > because those get axed under the minimum > requirement to do the job standard (you get fired > eventually if you don’t pass your CPA exams). Awesome topic. I was about to post a question about this exact topic, but decided to use the search function. Definitely would appreciate thoughts on this situation to see if it would be tax deductible in my case: I work in real estate valuation and plan on taking it to the next level to business valuation in the future (at my current firm). Apparently, the CFA charter is considered a strong credential for business valuation (although I’ve since dropped the CFA program in favor of the CPA/MAI combo). My firm also “highly encourages” its employees to become credentialed, so in my mind that is an implicit requirement that to get promoted, one must earn credentials, especially if he/she is to become a partner where his/her only job will be to use his/her experience, credentials, connections and personality to win business. Therefore, in my mind, I fall under a) My boss (implicitly) requires credentials and covers none of the expense and b) It will improve my ability to do my job, to get promoted, and to win new clients. My only issue is that my job technically doesn’t fall under “finance,” although one could argue that I value proposed and current real estate investments and give my opinions on the veracity and strength of the proposed and current investments for private (and sometimes public) consumption. Any thoughts on this situation? Would it be ethical/unethical to take this tax deduction? Also, while we’re at it, strictly out of curiosity, would my job count toward CFA work experience requirement?
Kkent, It would be filled out on form 2106. Basically as long as it is not a designation to change jobs (like the Bar Exam or CPA), you may deduct it. I cannot take it since I do not itemize on the Schedule A and trying to make it fit on a lifetime learning credit is pushing it. This is helpful too, http://www.irs.gov/publications/p970/ch12.html#d0e11500
Very nice. Very nice. “OR The education maintains or improves skills needed in your present work” AND it’s neither a minimum requirement for your job nor a program of study to switch trades. I love you, man, in a PLATONIC way. You just wrote me a check for about $100.
You’re welcome K. It’s the least I can do for all those Dilbert questions I’ve asked you over the year!
Hey CJH, did you ever hear back from the CFAI about the lifetime learning credit?
sorry i meant hey KJH
Dan, I’m going to try for it. It appears to fit the description. When I looked into the tax code about lifetime learning credit, non profit proprietary education counts. Therefore the CFAI program appears to fit. Worst case scenario I’ll get audited, submit my receipt, be told I cannot take it, any pay back the ~$200 plus interest. I checked into that with a CPA I did taxes with part time last year. He encouraged me to take it since the lifetime learning credit is really elastic. He also suggested filing at the last minute as less returns get audited at that time rather then earlier. However please check with your tax professional for your individual circumstance. I will not be held liable for an audit.
It’s the tax season again, so… For those who took deductions, do you claim it under educational expenses or job-related expenses? Thanks.
look up lifetime hope and learning credit. you can totally deduct it, assuming your employer hasnt reimbursed you for the costs
Educational expenses, non-tuition. CFA exam fees do not qualify towards any tax credit. The Hope credit was done away with in 2010. You can definitely deduct it as builders said. http://www.analystforum.com/phorums/read.php?12,665839 Another good thread about it from the past. Deductions are one thing, but credits are a different story.