Is an online course line 27a or not deductible?

Education that qualifies you for a new trade or business is not deductible at all, however useful it is and however much you learn, so the test is not usefulness but whether you are already in that trade.

Is an online course line 27a or line 24a?

The course fee is line 27a but the flights, hotel and ground transport to attend an in-person course away from home are travel on line 24a.

Where does an online course go on Schedule C? Line 27a

Q: Where does an online course go on Schedule C?

An online course belongs on Line 27a, other expenses. Work-related education is deductible when it maintains or improves the skills you need in the trade you already carry on, or when a law or a licensing body requires it to keep your standing. There is no education line in Part II, so the fee is described in Part V and totals onto line 27a. The deciding fact is the trade you are already in: a bookkeeper taking an advanced payroll course is improving present skills, which is deductible, while the same course taken by a photographer who wants to start doing books is training for a new trade and is not.

Short answer Schedule C, Line 27a Other expenses (itemised in Part V)

An online course belongs on Line 27a, other expenses.

Why line 27a

Work-related education is deductible when it maintains or improves the skills you need in the trade you already carry on, or when a law or a licensing body requires it to keep your standing. There is no education line in Part II, so the fee is described in Part V and totals onto line 27a. The deciding fact is the trade you are already in: a bookkeeper taking an advanced payroll course is improving present skills, which is deductible, while the same course taken by a photographer who wants to start doing books is training for a new trade and is not.

Stop looking up lines one at a time. ClaryBook totals your year into an IRS Schedule C worksheet in form order, Part I and Part II line by line, so an online course lands on Line 27a without you sorting it.

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What an online course is confused with

not deductible, not deductible: Education that qualifies you for a new trade or business is not deductible at all, however useful it is and however much you learn, so the test is not usefulness but whether you are already in that trade.
Line 24a, travel: The course fee is line 27a but the flights, hotel and ground transport to attend an in-person course away from home are travel on line 24a.
Line 18, office expense: A software subscription that happens to include tutorials is office expense on line 18, while a course sold as a course is line 27a.

Examples that belong on line 27a

$249 advanced financial modelling course taken by a working bookkeeper
$89 Udemy course on a new version of Revit for a drafter already doing drawings
$600 of state-required continuing education for a licensed real estate agent
$120 online CPE webinar bundle for an enrolled agent
$340 code update class a working electrician has to take to renew

What does not belong here

A course that qualifies you for a new occupation, such as a bar review course or a first CDL course.
Tuition for a degree that gets you into a field you are not yet working in.
Travel, lodging and meals to attend, which belong on lines 24a and 24b.
A course taken before the business opened, which is a start-up cost with its own timing rules.

The limit that applies

The education must maintain or improve skills required in your present work, or be required by law or a regulator to keep your status. Education that qualifies you for a new trade or business fails even if it also improves your current skills.

What to keep

Keep the enrolment receipt and the course outline or syllabus. The outline is what shows the subject matter tracks the work you already do, which is the point an examiner would question.

Other expenses on line 27a

Expense	Line
a background check	Schedule C, Line 27a
a branded gift for a client	Schedule C, Line 27a
a business coach	Schedule C, Line 27a
a conference registration fee	Schedule C, Line 27a
a hot-desk day pass	Schedule C, Line 27a
a payroll service	Schedule C, Line 27a
a professional certification renewal	Schedule C, Line 27a
a stock photo license	Schedule C, Line 27a
a telephone answering service	Schedule C, Line 27a
a trade show booth fee	Schedule C, Line 27a
a translation service	Schedule C, Line 27a
bank fees	Schedule C, Line 27a

Related lookups

Sources

This page explains how Schedule C lines work. It is general information, not tax advice for your situation. If an expense is large or the answer turns on a fact about your business, confirm it with your tax preparer.

Looking for a different expense? The full Schedule C line lookup has every line from 8 to 27 with the expenses that belong on each, and Schedule C expense categories walks the whole form in order.

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