Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, H.R. 5334, 119th Cong. (2026) (enrolled bill transmitted to the President Sept. 17, 2027); 26 U.S.C. § 62(a)(2)(D), (d)(1).

H.R. 5334, designated as the “Lindsey O. Graham Sanctioning Russia and Iran Act of 2026,” represents a statutory measure originating in the 119th Congress. Introduced by Representative Jimmy Panetta [D-CA-19] on September 11, 2025, and referred to the House Committee on Ways and Means, the measure was formally reported as amended under House Report 119-600. Following passage in the House of Representatives on April 27, 2026, the Senate considered the bill under Amendment SA 6711, proposed by Senator Lindsey Graham. The Senate passed the amended bill, and on September 16, 2026, the House concurred in the Senate amendments by a roll call vote of 262 to 159. The enrolled legislation was subsequently transmitted to the President on September 17, 2027.

While the primary division of H.R. 5334 enacts extensive economic sanctions, energy export bans, and international financial restrictions under Division A, the bill also incorporates targeted amendments to the Internal Revenue Code of 1986 (I.R.C.). Specifically, the legislation expands the above-the-line deduction for educator expenses under I.R.C. § 62(a)(2)(D) to incorporate early childhood educators. For tax practitioners, Certified Public Accountants (CPAs), and Enrolled Agents (EAs), understanding the precise interaction between current statutory provisions, the enacted amendatory language, and the statutory effective date is critical for proper income tax return preparation, client tax planning, and compliance strategy.

Current Statutory Framework Governing Internal Revenue Code Section 62 Educator Deductions

Under current tax law, I.R.C. § 62(a) defines “adjusted gross income” (AGI) as gross income minus specified allowable deductions, commonly referenced as “above-the-line” deductions. Among these employee trade and business deductions, I.R.C. § 62(a)(2)(D) permits an individual taxpayer to deduct certain expenses paid or incurred in connection with service as an “eligible educator”.

Currently, I.R.C. § 62(a)(2)(D) allows a deduction for expenses, up to $250 annually (as adjusted for cost-of-living increases under I.R.C. § 62(d)(3) substituting calendar year 2014 for 2016). To qualify under current law, expenses must be paid or incurred by an “eligible educator”:

“(i) by reason of the participation of the educator in professional development courses related to the curriculum in which the educator provides instruction or to the students for which the educator provides instruction, and
(ii) in connection with books, supplies (other than nonathletic supplies for courses of instruction in health or physical education), computer equipment (including related software and services) and other equipment, and supplementary materials used by the eligible educator in the classroom.”

In addition, statutory guidance under Public Law 116-260, Division N, Title II, Section 275 directed the Secretary of the Treasury to clarify that personal protective equipment (PPE), disinfectant, and other supplies used for the prevention of the spread of COVID-19 qualify under I.R.C. § 62(a)(2)(D)(ii).

Under current statutory definitions in I.R.C. § 62(d)(1)(A), the term “eligible educator” is strictly confined to individuals employed in elementary and secondary education settings:

“For purposes of subsection (a)(2)(D), the term ‘eligible educator’ means, with respect to any taxable year, an individual who is a kindergarten through grade 12 teacher, instructor, counselor, principal, or aide in a school for at least 900 hours during a school year.”

Furthermore, current I.R.C. § 62(d)(1)(B) defines a “school” as “any school which provides elementary education or secondary education (kindergarten through grade 12), as determined under State law.” Consequently, under current law prior to the enactment of H.R. 5334, pre-kindergarten, preschool, and early childhood educators are excluded from claiming the above-the-line deduction under I.R.C. § 62(a)(2)(D), even if they meet the 900-hour service threshold.

Statutory Modifications to Internal Revenue Code Section 62 Under Enrolled Legislation

Enrolled bill H.R. 5334 statutory provisions directly amend I.R.C. § 62 to eliminate the statutory exclusion of early childhood educators and expand the scope of qualifying educational institutions.

Specifically, the statutory amendment in Division B of H.R. 5334 amends I.R.C. § 62(d)(1)(B) by expanding the definition of qualifying institutions providing elementary and secondary education to expressly include early childhood education programs. Direct quotation from the statute reveals the statutory text modification to I.R.C. § 62(d)(1)(B):

“... secondary education (kindergarten through grade 12), any school which provides such education, as determined under State law.”

To align the internal cross-references and subsection titles within the Internal Revenue Code, H.R. 5334 executes a mandatory conforming amendment to the subsection heading of I.R.C. § 62(a)(2)(D). Direct quotation from the bill text confirms:

“(b) CONFORMING AMENDMENT.—Section 62(a)(2)(D) of such Code is amended by striking ‘CERTAIN EXPENSES OF ELEMENTARY AND SECONDARY SCHOOL TEACHERS’ in the heading and inserting ‘CERTAIN EXPENSES OF EARLY CHILDHOOD, ELEMENTARY, AND SECONDARY SCHOOL TEACHERS’.”

This legislative modification expands eligibility for the above-the-line deduction to early childhood teachers, instructors, counselors, aides, and principals, provided they satisfy the statutory requirement of working at least 900 hours during a school year in an early childhood facility or school as recognized under applicable State law. Because deductions allowed under I.R.C. § 62(a)(2)(D) reduce gross income directly to arrive at adjusted gross income (AGI), qualifying early childhood educators receive the tax benefit regardless of whether they claim the standard deduction or itemize deductions under I.R.C. § 63. Reducing AGI provides secondary tax benefits by lowering the baseline floor for AGI-sensitive tax credits, phaseouts, and medical expense deduction thresholds.

Statutory Effective Date and Tax Compliance Planning

The statutory effective date governing the amendments to I.R.C. § 62 is set forth in subsection (c) of the tax provisions of H.R. 5334. Direct quotation from the enacted statute establishes:

“(c) EFFECTIVE DATE.—The amendments made by this section shall apply to expenses paid or incurred in taxable years beginning after December 31, 2025.”

For calendar-year individual taxpayers, the expanded deduction applies to expenses paid or incurred on or after January 1, 2026 (Taxable Year 2026 and subsequent tax years). Expenses paid or incurred during Taxable Year 2025 remain governed by pre-amendment law, restricting eligibility solely to kindergarten through grade 12 personnel.

Tax professionals advising early childhood education clients should implement specific compliance protocols:

Substantiation and Recordkeeping: Clients must maintain contemporaneous receipts, invoices, and expense logs verifying that qualified expenses were paid or incurred for professional development, classroom supplies, software, books, or safety equipment pursuant to I.R.C. § 62(a)(2)(D)(i)-(ii).
Service Hour Verification: Practitioners must confirm that early childhood employees satisfy the statutory minimum requirement of 900 hours of service during the school year as an instructor, teacher, counselor, aide, or principal.
Reimbursement Checks: Under I.R.C. § 62(c), expenses reimbursed under an employer’s accountable plan cannot be deducted above-the-line. Taxpayers must substantiate that expenses were paid out-of-pocket and not reimbursed by their employer.

Prepared with assistance from Gemini Notebook.