Education Expenses Question (Computer)

[S1993]

Hello,

This year, my wife enrolled in online college. At the same time, she decided to pursue an interest in PC gaming. So we purchased all the parts for, and built a gaming desktop PC which she now uses for both completing online schooling and of course gaming. Is the cost of all the components that were purchased and used to build that PC eligible education expenses for reimbursement when we file our taxes? 

[tagteam]

@Hal_Al 

[Hal_Al · Accepted solution]

Q.  Is the cost of ALL the components that were purchased and used to build that PC qualified educational expenses (QEE) to claim an education tax credit? 

A. Probably not. See https://ttlc.intuit.com/community/college-education/discussion/is-a-computer-a-qualified-expense-for...

[Carl]

Here's how I interpret it.

Basically, if it states something in the syllabus for one or more courses the student is enrolled in, that a computer is required, then it would qualify. Additionally, if the syllabus states or infers that on-line submission of assigned coursework is required (as opposed to optional) for all or some assignments, then the purchase of a computer qualifies. Also, that the "primary purpose" of the purchase was for education, as opposed to gaming or any other personal *and/or* business use. So if you got a $3000 computer, I would expect such costs to be questioned - but only if audited. Could such costs of a computer for college trigger an audit? I have no idea. Even if the chances are slim (and they probably are), you can't rule it out.

Take note that if you do claim this computer as an education expense (it would fall under the "lab fees" category) and then later use it as a business asset, then it's cost basis as a business asset is ZERO, since you would have already deducted the cost of the computer as an education expense. Additionally, if you later sell the computer, then any income derived from the sale would be reportable income and taxable.

[S1993]

@Carl 

So she purchased about $1,800 worth of parts to build the computer. It doesn't contain any parts other than what makes a computer function, just slightly higher end versions of them. She also purchased a $150 printer + ink as the class required the use of one for not only printing homework but scanning it in as well. The computer will not be used for business purposes. 

So I'm guessing she is good to include the total under qualified expenses, and she has a digital receipt from each place that she bought parts from too that she can pull together if need be.