Pa. tax credit for out-of-pocket classroom costs to be considered

Bill to compensate teachers for any classroom expenses proposed

Alexa Kutch, like many educators, has made a habit of buying things for her classroom — from posters for the walls to lamps for softer lighting to decorative items sitting around the room.

She said it helps create an environment conducive to learning particularly since her classroom has no windows.

“Students respond better — and are more productive — to classrooms that are pleasant to be in,” said the third-year Freedom High School teacher in the Bethlehem Area School District. “I definitely pride myself on my classroom aesthetics and how comfortable it makes the students feel.”

She estimates she spent around $300 this year on items for her classroom. Other teachers spend more and sometimes for more critical items like paper, pencils, crayon and Kleenexes. A study by My eLearning World puts the average amount that teachers spent out of pocket on school supplies in 2023 at $853.90. Another survey of more than 1,100 teachers by the Association of American Educators puts the average at $673 a year.

Either way, it’s clear the out-of-pocket costs for teachers often fall above the $300 maximum the IRS now allows teachers to deduct off their federal taxable income for these expenses. That is $50 higher than the deduction permitted in 2022.

Currently, there is no teacher-specific tax break on state income taxes but legislation that the House Finance Committee will consider this week would change that.

The bill would provide teachers with up to a $500 state tax credit per year for their classroom purchases. It caps the amount of tax credits to be awarded at $15 million.

“Our teachers work hard to ensure every student has the tools needed to succeed,” said Rep. Ed Neilson, D-Philadelphia, the bill’s sponsor. “It’s only fair that we reimburse these teachers for these out-of-pocket expenses.”

Committee Chairman Steve Samuelson, D-Northampton County, said during a hearing on this proposal last week that he would be inclined to lower it to a $150 state tax credit to allow more of Pennsylvania’s estimated 120,000 educators to take advantage of it. He estimates that would raise the cost for this tax credit program to about $18 million.

He also intends to add a provision that would make teachers choose between taking this proposed tax credit or deducting their out-of-pocket classroom expenses as an unreimbursed business expense.

Rep. Keith Greiner, R-Lancaster County, latched on to a suggestion made by Laura Boyce, executive director of the nonprofit Pennsylvania Teach Plus, during her testimony about limiting the tax credit to teachers in high-need or underfunded schools.

“I do like the idea of a targeted one … for those areas where their salaries might not be as great or they have the greater challenges,” Greiner said.

Boyce also suggested making the tax credit re

fundable so even if a teacher’s out-of-pocket expenses didn’t hit the $500 limit that they could receive a refund for the difference.

“We don’t expect many other professions including lawmakers, to pay out of pocket for business expenses,” Boyce said. “But it’s very common for teachers to pay out of pocket.”

Paul Walsh, a 13-year English teacher at Bethlehem’s Liberty High School, said in his testimony to the committee buying classroom supplies is “one more thing” that gets added to the burden that new teachers, in particular, face in addition to paying on their student loans and covering living expenses at lower starting salaries.

“While $500 might not seem like a lot of money to some, this tax credit would be incredibly helpful to educators especially those early in their careers,” he said.

Both Boyce and Walsh see this measure as helping to address the labor shortage in the teaching profession, which Walsh termed as a crisis. Boyce quantified the problem for lawmakers in her testimony.

“The supply of teachers has plummeted by 75% over the past decade,” she said. “The state now issues more emergency permits than issues actual traditional certificates to fully qualified teachers. And we’re also at an all-time high in terms of teacher attrition. So the pipeline is really bleeding at both ends.”

Walsh said he sees the proposed tax credit as a step toward re-professionalizing teaching in this state.

The bill gained the support of Rep. Rob Mercuri, R-Allegheny County, whose wife is a teacher along with several family members. He said every year they use some of their own money to buy classroom supplies.

“I was always surprised being in the private sector previously that there wasn’t some stipend for Kleenex or whatever, pencils, supplies and those kinds of things,” Mercuri said. “Every single teacher is pulling that out of their own pocket, in some districts more than others.”

Rep. Leslie Rossi, R-Westmoreland County, said perhaps instead more pressure needs to be put on school boards to redirect funding to classroom supplies instead of administrative raises.

The Pennsylvania State Education Association, the state’s largest teachers union, meanwhile, said it supports the tax credit idea but the state needs to step up its funding to schools as well.

The union urges lawmakers to adopt Gov. Josh Shapiro’s $1.1 billion in new school funding proposal to begin to address the state’s inequitable school funding system that the Commonwealth Court last year determined to be unconstitutional.

“It shouldn’t be the teachers’ responsibility to provide classroom supplies any more than it should be their responsibility to fix broken HVAC systems in school buildings,” said PSEA spokesman Chris Lilienthal. “The state has a constitutional responsibility to fund our public schools so that every student has the appropriate resources they need to learn.”

Teachers send home lists of supplies they need for the classrooms. They post a wishlist on Amazon or AdoptAClassroom at backto-school time for classroom supplies they hope family and friends might buy for them. They apply for corporate-sponsored opportunities to pay for student and classroom needs. But what they don’t get through those efforts often teachers say they end up buying them.

“I believe teacher morale would be significantly increased especially in today’s climate,” Kutch said. “Teachers tend to have enough burdens and supplies for their classroom should not be one of them.”