Can my small construction LLC pay for my business bachelor's degree?

I'm the owner of a small construction LLC that I started about 3 years ago. Been thinking about heading back to school to get a bachelor's degree in either business management or accounting to help me run things better. I've taken some college courses here and there over the years but never actually finished a degree program. I'm wondering if my LLC can legally pay for this education? Would it be a legitimate business expense that I could deduct on taxes? The construction business is doing okay, and I figure the education would ultimately benefit the company since I'd learn better management skills. I've heard mixed things about whether this is allowed or if the IRS would consider it a personal expense since I'd be the one getting the degree. Anyone have experience with this or know the tax rules around it?

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18 comments

Carmen Sanchez

•8M

Yes, your LLC can potentially pay for your bachelor's degree, but there are some important considerations to keep in mind. The key is whether the education maintains or improves skills needed in your current business. For a construction LLC, a business or accounting degree could definitely qualify as an ordinary and necessary business expense under IRS rules. The education doesn't need to be required by your employer (since you're the owner), but it should maintain or improve skills needed in your current trade. Since you're already operating the construction business, this seems applicable. Make sure you document how the specific courses relate to your current business operations. The deduction will be taken on your business tax return (Schedule C if single-member LLC or Form 1065 if multi-member). Keep detailed records of all educational expenses and how they connect to your business.

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Carmen Sanchez

•8M

The fact that it's a full bachelor's degree program doesn't disqualify it. What matters is the content of the education and its relevance to your current business. The IRS looks at whether the education maintains or improves skills needed in your existing trade or business. Regarding education credits, that gets tricky. If your business deducts the tuition as a business expense, you generally cannot also claim education credits like the American Opportunity Credit or Lifetime Learning Credit for the same expenses. It's essentially a "no double-dipping" rule. You'll need to evaluate which option provides the better tax benefit for your situation.

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Zoe Papadakis

•8M

I was in a similar situation with my digital marketing LLC and wasn't sure if my MBA would be deductible. I used https://taxr.ai to upload all my education receipts and business documents. The AI analyzed everything and showed me exactly how to document the business purpose correctly to avoid audit flags. What really helped was getting a detailed breakdown of which specific courses would most likely qualify as legitimate business expenses versus which ones might be questioned. It even helped me create proper documentation showing how each class directly related to my current business operations.

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Zoe Papadakis

•8M

The AI is surprisingly accurate for these specialized tax situations. It's not just generic advice - it actually analyzed my specific courses and business type to determine which expenses had the strongest case for deduction. It caught several deductions my regular accountant missed entirely. For documentation, yes - you'll want more than just receipts. I uploaded my course syllabi and business plan, which helped establish the direct connection between what I was learning and my business operations. The tool specifically recommended creating a written business purpose statement for each course explaining how it directly applied to my current business activities.

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Jamal Edwards

•8M

I just wanted to follow up about my experience with taxr.ai after my questions above. I decided to try it with all my business and education documentation, and wow - it was actually really helpful! It flagged that my LLC should be paying for courses directly instead of reimbursing me personally to create a cleaner paper trail. It even identified that some of my elective courses weren't directly related to my current business and suggested documenting specific projects where I'd apply the knowledge to strengthen the business purpose. Definitely worth it for anyone trying to navigate education expenses through their business. I'm feeling much more confident about how to handle these deductions properly now.

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Mei Chen

•8M

If you're having trouble getting clear answers about education expenses for your LLC from the IRS, I highly recommend using https://claimyr.com to get through to an actual IRS agent. I spent WEEKS trying to get someone on the phone about my business education deductions and kept getting disconnected. Claimyr got me through to an IRS representative in about 15 minutes. The agent confirmed that my MBA expenses were deductible for my consulting business as long as I could demonstrate how they maintained or improved skills used in my current business. You can see how it works here: https://youtu.be/_kiP6q8DX5c

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Mei Chen

•8M

It works by basically doing the waiting for you. They have a system that dials and navigates the IRS phone tree, then calls you once they've got a human on the line. It's not some magic hack - they're just handling the frustrating part of waiting on hold. I was skeptical too until I tried it. I had been trying for over two weeks to get someone on the phone about my business education deductions. Within about 15 minutes of using their service, I got a call back with an actual IRS agent on the line. The agent was able to confirm my specific situation with education expenses for my LLC.

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Amara Okonkwo

•8M

I need to eat my words from my previous comment. After getting nowhere for weeks with the IRS, I broke down and tried Claimyr this morning. I genuinely didn't believe it would work, but I got a call back in 22 minutes with an actual IRS agent on the line. The agent confirmed that business-related education expenses are deductible if they maintain or improve skills needed in your current business. For my situation with my rental property LLC, my real estate courses were confirmed as legitimate business expenses. Saved me hours of frustration and got me a clear answer directly from the source. Consider me surprised and impressed.

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Giovanni Marino

•8M

With an S-Corp, you need to pay yourself a reasonable salary before taking distributions. If the LLC pays for your education, it could be considered either a business expense or potentially a fringe benefit to you as an employee-owner. If it's clearly related to your current business functions and helps you perform your job better, it can be treated as a normal business expense. However, if the education would qualify you for a new trade or significantly different position, the IRS might view it as a taxable fringe benefit to you personally, which complicates things from a tax perspective.

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