Cat food expenses and other unusual tax deductions
When it comes to taxes, one of the things people care about most is getting the most money back. And for good reason: not only is the tax refund the largest single financial transaction many taxpayers will have during the year, but taxpayers can make costly and common tax mistakes.
But not all mistakes are common. Real taxpayers have tried to claim some odd tax deductions and had them denied. Check out these funny tax stories:
- Air-conditioned hotel room: An asthmatic taxpayer with a broken air-conditioner was not able to deduct a one-night stay as a medical expense.
- Amortizing your life: A taxpayer with a real estate business estimated the value of the contribution of his life, time and expertise; he came up with a value of $1.75 million and began amortizing the amount as a business expense.
- Arson: An owner of a failing furniture store paid an arsonist to burn down his store. He reported the insurance as income but deducted the fee paid to the arsonist as a “consulting fee”—and admitted that to the IRS on audit.
- Bath oil: Although needed for dry skin, it was not deductible as a medical expense.
- Broken china and glassware: Broken by the family pet but not allowed as a casualty loss.
- Carpet removal: Carpet removal and installing hardwood floors were not deductible as medical expenses for an allergic taxpayer.
- Dancing lessons: Dancing lessons, whether to improve varicose vein problems or to ease arthritis and a nervous condition, were not deductible as medical expenses.
- Dentures: An actor used dentures to enable him to enunciate without a hiss but he was not allowed a business deduction.
- Dog boarding costs: The dog’s boarding expenses while the taxpayer was away on business were denied as a business expense.
- English setter: The prize-winning dog ran away but the casualty loss deduction was disallowed.
- Fallout shelter: The cost of a fallout shelter was not deductible as “preventive medicine.”
- Memories: Taxpayer was denied a theft loss deduction for the theft of photographs, souvenirs, college papers, and other “memories” she claimed her landlord had illegally removed from storage and thrown away.
- Military school: Not deductible as a medical expense for a taxpayer who sent his unruly son there.
- Mink coat: A businessman could not deduct the cost of a mink coat for his wife to wear to business functions.
- Salad: Lettuce and tomato were not deductible as a medical expense for a diabetic on a restricted diet. The same person also tried to deduct artificial sweeteners and reduced-salt foods.
- Samoan prayers: Medical treatment consisting of prayers and massages with plant leaves was not deductible.
- Tattoos: Even though they were done by professional artists, tattoos were not allowed as a medical deduction.
On the other hand, failing to deduct a qualifying expense, no matter how unusual, could mean paying more taxes than necessary. Sometimes strange tax deductions are allowed, like these real cases:
- Boarding school: Travel, room and board were allowed as medical expenses for sending a young child with respiratory problems to a boarding school in Arizona.
- Cat food: The cost of cat food used to attract wild cats in order to deter snakes from a scrapyard was allowed as a business expense.
- Clarinet lessons: Taxpayers were allowed to deduct the cost of a clarinet and clarinet lessons to help a child’s overbite.
- Organic foods: The difference between the cost of chemically uncontaminated food and regular chemically treated food was allowed as a medical deduction.
- Posing oil: A professional bodybuilder was allowed a business deduction for “ProTan Muscle Juice Professional Posing Oil.”
The important thing is that just because something was allowed by the IRS or Tax Court does not mean that another taxpayer with the same situation would be allowed the deduction. When in doubt, taxpayers should get advice from a qualified tax professional.
Learn more about changes to the casualty loss deduction that make personal disasters, like house fires, nondeductible starting in 2018.
Learn how to get all the tax benefits of parenthood, like the child care credit and child tax credit. While child care or medical expenses may be deductible, diapers usually aren’t.
Learn what qualifies for a service animal tax deduction and how they can help taxpayers with high medical expenses.
Use these year-end, tax-saving tips to reduce 2018 taxes and get the best outcome when filing your tax return next year.