Although you may consider a laptop computer an essential school supply, the Internal Revenue Service usually has a different opinion. No matter how helpful or convenient it is to you, it's only deductible if it fits within the definition of a qualified student, educational institution and a qualified expense according to the American Opportunity Tax Credit and the Lifetime Learning Credit.
Whether a laptop is a qualified education expense depends partly on where you attend school. You must take classes at a post-secondary educational institution that accepts federal student aid programs. For example, a laptop might qualify if you attend a state university, but most likely would not if you took a computer networking class at a private boot-camp style training school.
Requirements Can Equal Deductions
School or program requirements also play a role in determining if your laptop for school is tax deductible or not. However, your school laptop can qualify if the school or program formally requires the device as a condition of enrollment or class attendance. For example, if you buy a laptop to pursue an online degree, the purchase might qualify if the college catalog or course syllabus clearly says you need one to complete the class. You'll need proof of that requirement in a case of an audit.
Income and Student Requirements
High-income taxpayers who don't qualify for either tax credit won't be able to deduct a laptop even if it meets the other criteria. The American Opportunity Tax Credit is just for taxpayers whose modified adjusted gross income is no more than $160,000 if married filing jointly or $80,000 if single, head of household, or a qualifying widow or widower. The Lifetime Learning Credit is an option for taxpayers whose modified adjusted gross income is no more than $132,000 if married filing jointly or $66,000 if single, head of household, or a qualifying widow or widower.
Even if you and the laptop do qualify, you may not be able to deduct the full cost. According to IRS Publication 970, the American Opportunity Tax Credit provides a $2,500 deduction and the Lifetime Learning Credit allows for $2,000. You can only claim one credit in a single tax year, not both. In addition, each credit also includes tuition and other qualified education expenses besides a computer. For example, if qualified expenses come to $4,000, you can only deduct $2,500 or $2,000, depending on the credit you claim.