You're basically looking at two issues: qualifying for a new profession and hobby losses. Generally, education that qualifies you for a new profession is not tax deductible. An exception would be the higher education benefits discussed in IRS Publication 970.
Publication 970 states:
Once you have met the minimum educational requirements for your job, your employer or the law may require you to get more education. This additional education is qualifying work-related education if all three of the following requirements are met.
- It is required for you to keep your present salary, status or job,
- The requirement serves a business purpose of your employer, and
- The education is not part of a program that will qualify you for a new trade or business.
So based on the foregoing, it certainly sounds like your education expenses would qualify as a tax deduction.
If you do not carry on your ballroom dancing activity to make a profit, you cannot use a loss from the activity to offset other income. Activities you do as a hobby, or mainly for sport or recreation, are often not entered into for profit.
If you're reporting losses from ballroom dancing for more than two years, the IRS may begin to disallow deductions in excess of income unless you can show that it is not a hobby. Good luck and break a leg -- or is that just show-business talk?
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