3/22/2006

Possible Tax-Write-offs!

As I read the economics roundtable blog, I came across an interesting link within it commenting on the prospect of people getting a tax write-off for their mbas. If this were to become a legal, widespread practice, the results could be great! I am completely in favor of such a practice, and think it would be a great incentive for people to further their education. Regardless of whether or not someone pursues an mba for a better job, a more educated society, is a better society!!! More knowledge=more power.

10 comments:

Seth said...

You can already get a write off for getting a MBA. Education to enhance your career is tax deductible so if you already have a job that doesn’t require an MBA and you are getting an MBA to do your job getter, you can write off many school-related expenses. This is not true if your education qualifies you for a different career than the one you are currently employed in. I suggest you read this article written by two SUU professors, Jeff Barnes and Kathy Black. (http://www.mountainplains.org/articles/2005/general/MBAEducationExpensesCanBeDeductable.doc)

Jake said...

I think this is a great idea. Not only because it would give me an additional tax write off, for another reason. Allowing people to writ off expenses creates an incentive to attend school. Giving a deduction for a degree creates an incentive to complete a degree.

bryce said...

I would love a tax deduction right now as I am taking classes to complete my MBA. On the other side of things, if a deduction became standard then more people could become motivated to get an MBA. This would lead to more MBA's in the employment field which would decrease the value of an MBA.

rico said...

I have to agree with Bryce. A bachelor's degree is almost as common as a high school diploma (Statistically probably not close, but you know what I mean). If everyone were able to get an MBA, then we would all be pursuing a more advanced degree to differentiate ourselves. For most of us this isn't possible because we'd have to leave Cedar City. Who would want to do that?

zoe said...

Additional tax write-offs are a huge incentive for individuals to further their eduation and recieve an MBA. However, I do also believe with a few of the other comments that have been posted that as more and more MBA graduates enter the field, the letters "MBA" following your name on a resume is not going to be quite as impressive if a large percentage of the other resumes in the field carry the same title.

will said...

I am glad the government is considering the MBA as a tax cut. I agree with what everyone has said, that more of an education is always a good thing. Also I would not mind since this would give me an additional tax cut.

Ole said...

Even though the tax incentive would encourage more people to attain an MBA degree and with more MBA’s that may mean your degree may be less meaningful, you would still have to differentiate yourself. You would need to prove by performance or some other way that you are better than the other person with the MBA degree.

Dr. Tufte said...

-1 on Jake's comment for spelling errors.

Hmmm ... if we allow corporations to deduct investments in capital we should also allow people to deduct investments in education. It seems reasonable to me that we should either permit or deny both. I'd rather the latter, but the former is OK too.

I am not in agreement with Blake that more education is always better. For an individual there is a prisoner's dilemma that makes education a good choice, but I'm not sure that society is better off if everyone gets more education.

Bryce has hit on this point. To extend it a little, once you graduate you should probably oppose deductibility of an MBA - you can no longer benefit, and you may be hurt by new entrants.

Ms. WoodyHills said...

So an MBA is apparently a write-off, but is there a maximum income? I heard that if you make more than $75K p/yr, you can't write-off the cost of your MBA. And what about the expenses associated with your MBA, such as gas, supplies, etc?

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