Tax Help for Homeschoolers

August 16, 2017

En Español

August is back to school time for Hoosier students across the state. Although homeschoolers in Indiana are not required to follow a traditional school calendar, now is a good time to remind homeschool families about the state’s homeschool tax deduction.

Indiana taxpayers with a child or children enrolled in private school or homeschool may qualify for a reduction in taxable income of $1,000 per qualified student.

A tax deduction reduces your taxable income, before calculating state and local tax. Local tax reductions may apply, and will vary by locality.

The deduction is based on education expenditures paid for each dependent child. Eligible expenditures include tuition, fees, textbooks, workbooks, curricula, written materials used primarily for academic instruction, and school supplies (other than personal computers) that are not reimbursed through other methods.

You may be eligible the deduction if:

  • you are eligible to claim the child as a dependent on your federal tax return;
  • the child is your natural or adopted child or, if not, you must have been awarded custody of the child in a court proceeding making you the court appointed guardian or custodian of the child;
  • the child is eligible to receive a free elementary or high school education (K-12 range) in an Indiana school corporation;
  • the child is not receiving instruction at home through the public school system;
  • the child is not enrolled in a charter school; and o the child was in attendance a minimum of 180 days in the calendar year for which you claim the deduction.

If you qualify for the deduction, you must claim it on Schedule 2 of the IT-40 form when filing an annual state tax return. A qualifying child may be claimed for this deduction only once per year. For example, if a husband and wife are married and filing separately, whichever parent is eligible to claim the child as a dependent for exemption purposes is eligible to claim this deduction. Please refer to the IT-40 Full-Year Resident Individual Income Tax Booklet for additional instructions.

For more information about this deduction, see Income Tax Information Bulletin #107 at www.in.gov/dor/3650.htm.