Can You Claim Martial Arts on Your Taxes?


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Knowing which expenses are tax-deductible can be confusing. But sometimes, kids’ extra-curricular activities can be tax-deductible. So, can you claim martial arts on your taxes?

Here’s what I know from running a large martial arts school:

Generally, martial arts cannot be claimed on taxes for a child or an adult as it is classified as a hobby by the I.R.S. Martial arts can only be claimed as a childcare expense if the instructors watch the child for an extended period after school. However, martial arts summer camps are often tax-deductible.

Martial art classes are enrichment programs that are seldom ever tax-deductible.

We’re just getting started. Read on to learn more. In this article, we’ll explore whether kid’s extracurricular activities are tax-deductible.

We’ll find out which child expenses are deductible. We will also find out if all types of martial arts classes for kids are tax-deductible.

What about adults? Are self-defense classes for adults tax-deductible? And we’ll wrap up by considering whether martial art summer camps are tax-deductible.

Let’s get started.

Are kid’s extracurricular activities tax-deductible?

Most extracurricular activities for kids are not tax-deductible. In general, a tax deduction can be taken for childcare while the parents are working, so a class that is between 30 minutes to 1-hour will not fit those criteria.

Virtually all extracurricular activities are not for this purpose.

The exceptions would be martial arts schools that offer an after-school extended care program. Some schools operate this at local schools. But some actually have small buses that come and pick kids up from school and drive them to their facilities.

In those cases, since it is often for 2-4 hours, it could be tax-deductible.

A lot of kids experience challenges in school these days. This is one of the reasons martial arts are often suggested.

But does Karate help with anxiety?

Luckily, this is what I explored in a recent article of mine. In it, I looked at why martial arts are good for mental health. Then, I explored how Karate relieves stress. I also spoke to the best martial art for depression.

Just click the link to read it on my site.

What child expenses are tax-deductible?

Tax-deductible child expenses primarily include summer camps, after-care, or daycare where a child is watched for a period of time while the parents are working. The child needs to be under age 13, but a disabled child of any age is also eligible.

The tax credit is currently up to 35% of the total expense cost.

These fall under four main categories of deductions. They are the child tax credit, the child and dependent care credit, education tax credit, and the earned income tax credit. There are strict criteria to be met before these deductions are made.

Let’s check 2 out of the 4 categories. We’ll focus on the key considerations because of the constraints of space.

  • Child and Dependent Care Credit
  • Child Tax Credit
  • Earned Income Tax Credit
  • Education Tax Credit

Child and Dependent Care Credit

This deductible will help you lower your tax bill if you (or you and your spouse) pay someone to look after a child or dependent while you (or you and your spouse) go to work or look for work.

The child or dependent must be under the age of 13.

Persons living with you and that you’re incurring care expenses over who are physically or mentally disabled to take care of themselves also qualify. In this case, the age restriction does not apply. They could be below or above 13.

The amount you claim is a percentage of total income, and it’s based on a sliding scale.

The range is from 20% to 35%, with those earning low income able to claim up to 35%, while those with high income can only claim up to 20%.

Child Tax Credit

This deductible provides a significant benefit to Americans with children.

Currently (and tax laws change often), you can claim up to $2000 for each child, as long as they are under the age of 17.

It lowers the amount you owe in taxes and could be refunded up to the tune of $1400. You can also claim up to $500 for dependents who are over age 16. They must be U.S. citizens.

But this Child Tax Credit (CTC) is not available for every parent.

If you’re earning $200,000 each year ($400,000) for a married couple, you cannot claim CTC. You will qualify if your modified adjusted gross income is up to $75,000 for single filers and $150,000 for married couples.

If you earn more, you will see a reduced credit, or you may not qualify.

For the year 2021, CTC has been increased and is now fully refundable. For children under the age of 6, it is $3,600. $3000 for children aged 6 up to the age of 17.

We’ve looked at the essentials of both forms of credit. You can access a lot more info on the IRS website.

Now, let me ask you a question: what kind of martial art would be great for teenage girls?

You’re in luck because I have experience in this domain and a recent article of mine speaks to the theme.

In the article, I explored whether Jiu-jitsu is good for girls. I also revealed whether 15 is already too old to start martial arts. And, I showed which martial art can help teenage girls with anxiety.

Just click the link to read it on my site.

Are all types of martial arts classes for kids tax deductible?

Martial arts classes for kids are not generally tax-deductible unless they offer an extended after-school program. But if a martial arts school offers such a program, it would apply to any type of martial arts. 

But for most of us, it’s a moot point.

These are enrichment programs that have no bearing on taking care of a child while parents or guardians earn an income.

Enrichment programs, such as all types of martial art classes, sports classes, dance classes…are not tax-deductible.

Before an enrichment program can qualify, it must be work-related.

A day camp where martial arts classes are taught may qualify if it has served to enable the parents or caretakers of the child or dependent work or look for work. And the child or dependent must be under the age of 13.

All types of martial arts classes for kids are hobbies and are not tax-deductible unless they help the caretaker or parents generate income or look for an opportunity to do so.

Say one of your kids has decided to take up Karate. You’re a tad worried that it’s expensive. Is it?  

You’re in luck seeing as that’s what I explored in a recent article.

In it, I looked at why martial arts are so expensive and whether Karate is expensive compared to other sports. But I also checked out how to avoid Karate schools that charge way too much. And even spoke to how to get out of Karate contracts.

Just click the link to read it on my site.

Are self-defense classes for adults tax-deductible?

Self-defense classes for adults are not tax-deductible unless the training was directly benefiting a job, such as a bouncer. Generally, self-defense classes are regarded as hobbies by the IRS. 

Now, there could be exceptions if self-defense classes are being taken for business or work-related reasons. As I mentioned above, if you work as a bodyguard, bouncer, security guard…and the skills are to help you earn an income or generate a profit.

The following are some helpful things to consider in determining if an activity is a hobby or one aimed at generating profit:

  • Do you depend on income from the activity?
  • Does the time and effort put into the business indicate an intention to make a profit?
  • Does the activity make a profit in some years?
  • Have you changed methods of operations to increase profit in recent years?
  • Do you have the knowledge needed to carry on the activity as a successful business?
  • Have you made a profit from similar activities in the past?
  • Does the activity make a profit in some years?

But it’s worth pointing out that for me, because of this website, the martial arts classes I take CAN be tax-deductible as a business expense.

Even if your classes are not deductible, martial arts offer a lot of benefits that cannot be quantified.

In a recent article, I looked at the key benefits of learning martial arts and why we need to learn self-defense.

But I also explored the elephant in the room: do martial arts make you violent? And I spent some time on the side effects of martial arts.

Just click the link to read it on my site.

Are martial art summer camps tax deductible?

Martial art summer camps are often tax-deductible. Unlike classes, summer camps are often 2 or more hours in length and are taken by kids while the parents work. As such, they do typically qualify for a tax deduction. 

So for many, it is tax-deductible!

This deduction falls under the Child and Dependent Care Credit and is designed to help parents or caretakers defray child care expenses while looking for work.

Let’s check out the prerequisites for taking advantage of the Child and Dependent Care Credit.

  • You must have earned income for the tax year. This applies to your spouse if you’re married and are filing jointly.
  • You must be the parent or main caretaker of the child or dependent.
  • The care services must have been to enable you to work or to look for employment.
  • The child must be under 13. It also applies to a child under 13 who is disabled, mentally or physically, such that they are unable to take care of themselves. If the latter condition is the case, and the child is permanently disabled, a child above 13 could qualify.

In general, most enrichment programs such as martial art classes, sports classes, cooking classes, or dancing classes do not qualify as deductibles because they’re not to help the parent or caretaker work or look for work.

Conclusion

In the article, we found out whether kid’s extracurricular activities are deductible and which child expenses are deductible.

Then, also found out if all types of martial arts classes for kids are tax-deductible.

What about self-defense classes for adults? We learned that most are not tax-deductible. We wrapped up by considering whether martial art summer camps are tax-deductible.


Image by Steve Buissinne from Pixabay Image by RENE RAUSCHENBERGER from Pixabay

Jeff Campbell

Jeff Campbell was Academy Director for a large martial arts school for over 7 years, and has trained extensively in a variety of martial arts including Brazilian Jiujitsu, different styles of Karate, the Russian Martial Art of Systema, Aikido, and much more.

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