Problem 3-14
Educational Expenses (LO 3.6)
Question Content Area
a. Loren is a secretary in a lawyer’s office. Since he often deals with legal matters, Loren feels that a law degree will be beneficial to him.
May Loren deduct his educational expenses for law school?
Yes, because the educational expenses must be paid to meet the requirements for keeping his job.
No, because the education is part of a program that will lead to a new trade or business.
Question Content Area
b. Alicia is an employee in the sales department for an international firm. She wishes to learn Spanish to improve her ability to communicate with foreign clients.
Does Alicia meet either of the two tests to entitle her to deduct the educational expenses?
Answer choices
Yes
No
Can Alicia deduct the expense as a miscellaneous itemized deduction (assuming she itemizes)?
Answer choices
Not applicable since she does not meet the requirements to claim the deduction.
Yes
No
Question Content Area
c. Joan is a practicing lawyer. She enrolls in a local medical school and works toward a medical degree in her spare time.
May Joan deduct her educational expenses for the medical classes?
Answer choices
Yes, because the educational expenses must be paid to meet the requirements for keeping her job
No, because the education is part of a program that will lead to a profession.Yes, because the educational expenses must be paid to meet the requirements for keeping her job.