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Tax Deductions for TPS Tuition

Is TPS – The Potter’s School tuition a tax-deductible “qualified education expense” under U.S. federal or state law? Most likely for you it is not.

For college expenses to be deductible, the college must provide a 1098-T. TPS College courses are dual credit, not dual enroll. Students do not enroll in the college to take the course. The tuition is not paid to the college.

However, the “529 deduction” also extends to tuition payments to elementary and secondary schools made after January 1, 2018. Is TPS – The Potter’s School tuition tax deductible under this extension? Most likely it is not, because the federal government specifically excludes homeschooling from this deduction. The requirements for the deduction are:

  • The payments must be for tuition (not other school expenses).
  • The institution must be “a public, private, or religious school” (it can be an online school).
  • The deduction may not be used for homeschool expenses, including fees paid for “classes” taken from outside organizations.

How is a “school” defined in this instance? According to the statute, it is “any school which provides elementary education or secondary education (kindergarten through grade 12), as determined under State law.” Whether TPS can be considered a “school” under this definition is a matter of interpretation and the laws of each state. The “safe” interpretation of the language is that qualified education expense deductions are limited to tuition paid by students enrolled full-time in a state-registered school. By definition, independent home educated students are not enrolled full-time in state-registered schools, regardless of where they take classes (to the best of our knowledge, the law has not been tested on this point).

If you plan to use TPS tuition as a “qualified education expense” on your taxes, we recommend you consult a tax professional registered in your state. Please do not include TPS in your decision process because TPS is not a tax expert in any state and will not provide you guidance outside of our expertise and authority. If you request it, TPS will provide you a signed receipt for tuition, fees and payments for a specified period. TPS will not provide you a “tuition-only receipt” or a “tuition receipt for tax purposes” or a “school tax ID” (TPS does not have a “school tax ID”) for any request — TPS will politely decline any tuition verification request that is for “tax” purposes.

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