It’s time to start back-to-school shopping, which may include purchasing supplies for distance learning due to COVID-19. The Minnesota Department of Revenue reminds tax professionals that most school supplies qualify for valuable K-12 tax benefits on their clients’ 2020 Minnesota income tax returns. Remind your clients to save their school supply receipts.

“Every year, parents across Minnesota invest in their children’s education by purchasing school supplies,” said Revenue Commissioner Cynthia Bauerly. “This year, distance learning may have changed the nature of investments made. Parents should keep receipts for these purchases, including distance learning needs, and claim the K-12 Education Credit or Subtraction to help save money when it comes time to file taxes.”

What K-12 tax benefits does Minnesota offer?

Two Minnesota tax benefits help families pay their child’s education expenses: the K-12 Education Credit and the K-12 Education Subtraction.

Both benefits reduce your clients’ state tax and could provide a larger refund when filing Minnesota income tax returns. Last year, more than 36,000 families received the K-12 Education Credit and saved an average of $251. Nearly 192,000 families received the K-12 Education Subtraction.

Do my clients qualify for these tax benefits?

To qualify for either the credit or subtraction, both of these must be true:

• Your client has a qualifying child attending kindergarten through 12th grade at a public, private, or home school
• Your client purchased education-related expenses in 2020 to assist with the child’s education

Separate requirements apply for the credit and subtraction.

• K-12 Education Credit: Your client’s household income (taxable and nontaxable income) must be below the levels shown in the table. If they qualify for the credit but do not need to file a Minnesota return, they must file a return to claim a refund for the credit. If your client is married, they must file a joint return to qualify.

Number of qualifying children in K-12	Household income must be less than
1 or 2	$37,500
3	$39,500
4 or more	Add $2,000 for each additional child

• K-12 Education Subtraction: There are no income limits for the education subtraction.

What education-related expenses qualify? 

Most expenses for educational instruction or materials may qualify, including:

• Paper and notebooks
• Pens and pencils
• Nonreligious textbooks
• Rental or purchases of educational equipment, including musical instruments
• Computer hardware (hotspots, modems, and routers) and educational software (up to $200 for the subtraction and $200 for the credit)
• After-school tutoring and educational summer camps taught by a qualified instructor

For more information:

• See Qualifying Expenses for the K-12 Education Credit and Subtraction
• See our video on how the credit works