How can I deduct my wife's law school tuition?

[beezer137]

What is the name of your state? Illinois

Although I work as a pediatrician, I started a business on my own (which I am working on very slowly) in 2004 called Dr. Beezer Physician and Language Services, to provide interpreters for physicians and hospitals and other miscellaneous services. My basement is my home office and makeshift clinic. I have not made any income on this business yet (except $200-$300 or so in 2004). It would help me a lot if I hired a lawyer or had a lawyer working for me, and maybe I could provide legal services then.

My wife just started law school this August, 2005. I am paying for her law school tuition anyway.

Is there any way that I can set it up so that my business is hiring her as an employee and then paying for her law school as a business expense so that the entire tuition of the law school is tax-deductible?

I know that big businesses do this all the time, and legally, there should be no difference between a small non-profitable business I started last year and a large business like IBM in terms of what it can and cannot do.

Please tell me if this is possible, and if so, what documentation do I need?

Thank you,

Dr. Beezer

 

[abezon]

You'd have to form a corporation, & you couldn't send your spouse to school with corporate funds anyway. You can claim education credits (income < $100,000) or a tuition & fees deduction (income < $160,000). See a tax pro about ways to get your AGI down if you're phasing out of deductions/credits.