Originally Posted by
Tolpin
I am a military pilot, qualified to operate in the FAA Airspace. I paid for and took an ATP/CTP class this year to be eligible to take the ATP written exam. I then paid for and flew my ATP practical exam with a local flight school. Are my expenses tax deductible? I ask because my total cost out of pocket was significant. I'm sure it will attract attention when I file my taxes.
I believe they are because I paid for the training to meet the requirements of an employer.
"An individual is considered to have undertaken education in order to meet the express requirements of his employer, or the requirements of applicable law or regulations." In this case for me to seek employment with an Airline I must have an ATP Certificate as required by law.
-----------------------------------------------
26 CFR 1.162-5 - Expenses for education
(c) Deductible educational expenditures
(1) Maintaining or improving skills. The deduction under the category of expenditures for education which maintains or improves skills required by the individual in his employment or other trade or business includes refresher courses or courses dealing with current developments as well as academic or vocational courses provided the expenditures for the courses are not within either category of nondeductible expenditures described in paragraph (b) (2) or (3) of this section.
(2) Meeting requirements of employer. An individual is considered to have undertaken education in order to meet the express requirements of his employer, or the requirements of applicable law or regulations, imposed as a condition to the retention by the taxpayer of his established employment relationship, status, or rate of compensation only if such requirements are imposed for a bona fide business purpose of the individual's employer. Only the minimum education necessary to the retention by the individual of his established employment relationship, status, or rate of compensation may be considered as undertaken to meet the express requirements of the taxpayer's employer. However, education in excess of such minimum education may qualify as education undertaken in order to maintain or improve the skills required by the taxpayer in his employment or other trade or business (see subparagraph (1) of this paragraph). In no event, however, is a deduction allowable for expenditures for education which, even though for education required by the employer or applicable law or regulations, are within one of the categories of nondeductible expenditures described in paragraph (b) (2) and (3) of this section.
I'm with dl773 on this one. I've researched this fairly extensively in the past and have heard consistent opinions that almost all flight training is not deductible. I value the opinions, as like DL, they were from professional accountants who have seen every scenario of deduction attempted. The consistent theme was essentially this: if said training was absolutely mandatory to keep your CURRENT job and, obviously, paid for out of pocket, then it is deductible. (1) in the quoted CFR is pretty much saying the same thing IMO - "required by the individual in his employment". In the case of a mil pilot deducting an ATP for future job hunting...? Clearly not deductible from everything I've been told.