Brooke Richardson, who teaches English as a second language to mostly low-income Hispanic students in Atlanta, prides herself as a master discount shopper. But as she turns to her own pocketbook to help her students, the purchases add up.
Richardson estimates that she spent $500 of her own money on her students last year. What has been helpful is that she's able to deduct $250 from her taxable income for the extras she buys for her classroom, a small bonus that Congress created in 2002 for teachers who "go above and beyond."
Now, the educator expense deduction has become a sticking point in the GOP tax debate, with the House and Senate taking it in two different directions.
The House GOP tax bill would scrap that educator deduction.
The Senate GOP tax plan would double it to $500.
Richardson said she's lost track of how many pencils, markers, notebooks and glue sticks she buys a year. Then there are the marshmallows and cotton balls for hands-on projects. And then there are the extra books so the kids have something to read on the weekends and during holiday breaks, and peanut butter and jelly so kids who don't have enough to eat have at least some food at Christmas.
Every year, she also has had to replace headphones or other classroom technology items because something always malfunctions, and there's rarely enough money in the budget to fix it. She says it's all worth it -- her voice lights up talking about "her kids" and all their "aha moments," many of which come when she deviates from the textbook.
"The tax deduction means a lot to teachers," said Richardson, who is 36 and lives in Atlanta. "Everything we bring to the classroom, we are doing it for our students. We are doing it because education isn't always properly funded on the state or local level."
The education expense deduction is one of many differences between the House and Senate bills that still have to be ironed out before a tax plan can be sent to President Donald Trump's desk. The House has already passed its version of the bill. The Senate is aiming to vote on its legislation next week.
What politicians ultimately decide could greatly affect America's 3.6 million teachers and their students.
One of the biggest champions of the teacher deduction is Sen. Susan Collins, R-Maine, who is considered a key swing vote on the tax bill. Collins helped create the deduction in 2002 and led the charge to make it permanent in 2015. Her office did not respond to a request for comment, but Collins has said several times in recent days that she is concerned that the tax bill isn't doing enough for the middle class.
The median salary for an elementary school teacher like Richardson is $55,490, according to the Labor Department, an amount that most say falls into the middle class. But teachers often start their careers at far lower salaries, and that's when they typically need to spend the most to build up their base of materials.
"The first few years that I taught I often spent over $500," said Darcie Schoeps, 39, who teaches social studies at a high school in the Bronx, N.Y. "The textbooks I was given my first year were so outdated they still had the Soviet Union listed as a country."
Schoeps, who has taught for more than a decade, used her own money to buy new maps and workbooks with Russia and other nations listed appropriately. Now she teaches general education, special-education and English-as-a-second-language students, requiring her to buy workbooks and games that can suit a wide range of abilities. In her ninth-grade classes, some students read at fourth-grade level.
Any full-time instructor at a public or private K-12 school is currently eligible for the $250 deduction. It's an "above-the-line" deduction, meaning teachers don't have to itemize to claim it. It's listed on the part of the tax form alongside deductions for moving expenses, student loan interest and health savings accounts. The House GOP bill does away with those popular deductions, as well.
The educator deduction gives a teacher earning about $55,000 a year an extra $40 to $50 in his pocket. Republicans in the House, including Speaker Paul Ryan of Wisconsin and Kevin Brady of Texas, argue that the time has come to simplify the tax code, even if it means getting rid of popular deductions.
"Keeping records of these expenses is often very burdensome for taxpayers, and this current-law deduction also poses administrative and enforcement challenges for the Internal Revenue Service," House Republicans wrote in a document explaining why they eliminated deductions for teacher expenses, medical expenses and others.
House Republicans say their bill gets rid of the teacher deduction but that many educators would still be better off because of an increase in the standard deduction and lower overall tax rates. For example, the 15 percent tax bracket falls to 12 percent in House GOP plan.
But Richardson, who is single, may be worse off.
Although the House bill does increase her standard deduction from $6,350 to $12,000, it also takes away other savings she uses. In addition to losing the $250 teacher deduction, the House bill eliminates the $2,500 student loan interest deduction, a benefit that helps many teachers like Richardson who get their master's degrees in education. She also would lose either the personal exemption, currently worth $4,050, or the ability to deduct some of her state and local taxes if she itemizes.
The Senate bill keeps the student-loan interest deduction, while the House bill eliminates it.
Richardson worries about other ways the legislation may affect education. The Senate bill scraps all state and local tax deductions. Most schools in the United States get their funding from property taxes. Atlanta's public schools already had to make budget cuts this year after a property-tax freeze. School funding could become even more contentious, especially in high-tax cities, if the GOP tax bills are enacted.
Any tax bill requires trade-offs. The House and Senate bills both reduce the tax rate for large corporations from 35 percent to 20 percent. It's a change that would be permanent. To pay for that, Republican lawmakers had to raise revenue elsewhere. The House bill did that by eliminating many tax breaks for individuals like the educator expense.
The educator expense deduction costs the federal government $210 million a year -- or about $2.1 billion over the 10-year time span of the tax bill, according to estimates from the Joint Committee on Taxation and the U.S. Treasury. The educator expense deduction costs less than 0.15 percent of the tax cut going to large corporations to lower their rates.
A Section on 11/23/2017
Print Headline: Tax bills split over educator expenses; House envisions end of deduction