Tax Deductable Expenses for CFI's

BrettInLJ

BrettInLJ

Well-Known Member
As a CFI can you duduct things like the premiums for CFI liability insurance, charts, etc.?

How about the cost of add-on ratings if you need them to get hired at a particular school?
 
BrettInLJ said:
As a CFI can you duduct things like the premiums for CFI liability insurance, charts, etc.?

How about the cost of add-on ratings if you need them to get hired at a particular school?
Click to expand...

You can only deduct up to the amount needed to offset earnings as a CFI, if it's not your primary source of income (i.e. a hobby)
 
BrettInLJ said:
As a CFI can you duduct things like the premiums for CFI liability insurance, charts, etc.?

How about the cost of add-on ratings if you need them to get hired at a particular school?
Click to expand...

I will be deducting moving expenses, as well as a new headset I purchased. I'm pretty sure you can deduct the CFI-I and MEI because they are advanced training for your job. I'm guessing if you had to pay for currency flights you could deduct those, as they are required for you to do your job, but consult a tax expert first. I won't be deducting any of those because I didn't have to pay for them...

~wheelsup
 
It would be my primary source as income, not a hobby. I would consult as tax expert except that on a CFI's salary, the cost of one hour with him or her would cancel out any tax savings it would give me. Who knows, itemizing deductions on a CFI salary might not even be worth it depending on the standard deduction, but I will see next tax year I guess. I will be saving my receipts for the MEI and CFI-A in the meantime. Because I will not have used these ratings outside my primary employment, and they are a necessity for the job, it sounds reasonable.
 
BrettInLJ said:
It would be my primary source as income, not a hobby. I would consult as tax expert except that on a CFI's salary, the cost of one hour with him or her would cancel out any tax savings it would give me. Who knows, itemizing deductions on a CFI salary might not even be worth it depending on the standard deduction, but I will see next tax year I guess. I will be saving my receipts for the MEI and CFI-A in the meantime. Because I will not have used these ratings outside my primary employment, and they are a necessity for the job, it sounds reasonable.
Click to expand...
It also depends on if you are an employee or a business unto yourself. As an employee, I can deduct unreimbursed business expenses, but only to the extent those expense exceed 2.5% of AGI (that % may be wrong). We have never been able to deduct things like my wife's union dues because those expenses, for us, never exceed the floor.

Also, as Dazzler alluded to, if CFI'ing is not your primary income, then you run into the hobby loss rule which is a whole nother thing (basically, you can only deduct expenses/losses to the extent of income/gains).

If you look around, AOPA or EAA or some other group might have a document on taxes for CFIs, which would at least be a start.
 
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