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Andrew Schwartz CPA
Apr 4, 2008 - 8:43PM
Re: Tax issue: Business Deduction for work related education expenses

I would say the question is whether the doctoral program will qualify you for a new trade or business.

If completing the Psy.D. program allows you to do things that you couldn't do without that designation, I'm afraid the cost of obtaining a Psy.D. wouldn't be tax deductible.

On the other hand, if you can provide similar services without the Psy.D. designation, but you can do your job better with a Psy.D., then you could argue that it would be tax deductible since it's improving your skills in your current trade or business.

I have never seen this rule applied to Psychologists. I have seen that the IRS has ruled that a practicing dentist is allowed to deduct the cost of a speciality program, and a psychiatrist in training is allowed to deduct the cost of psychotherapy that is a required part of his or her training.

I hope this sheds some light on this matter for you. I'm sorry I can't give you a more exact answer.

Zip Code: 01801

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