Surprising Tax Deductions
For most folks, any tax deduction that triggers a refund or keeps a filer from writing a check on April 15 is considered fair game. Of course, one person’s idea of a valid tax deduction — Madonna’s legs, for example — may not pass muster if you ask the Internal Revenue Service for the same consideration. The devil is in the details. If you produce proper evidence, even deductions you may feel hesitant about broaching can, surprisingly, pass muster.
According to Kiplinger.com, you may be able to deduct the cost of building a swimming pool if your doctor says the pool construction provides primary medical care/therapy rather than a recreation-only home addition. Other expenses incurred in association with the pool — heating unit, hydraulic lift for swimmers with mobility problems, pool chemicals and insurance — can also be expensed if the pool’s primary purpose is medical and you can prove it.
It’s every pet lover’s dream: deducting food and vet bills incurred for four-legged friends. You may be surprised to learn that, in some cases, you may qualify for a deduction if, for example, you are being relocated as a condition of employment. Adding the moving expenses associated with your pet’s relocation requires adequate documentation. Here’s another surprise: If your pet does more than hang around looking cute, you may be able to deduct its work product as well. Costs associated with, for example, a junkyard owner’s felines, responsible for patrolling property for rodents, may be allowed by the IRS if you can prove your case.
You might be able to write off alcohol-based beverages if you have a legitimate excuse to serve them as a promotional premium. A tax court upheld the case of a service station owner who replaced trading stamps with beer. Another surprise awaiting consumers wishing to write off alcohol has to do with traffic accidents. According to both Forbes.com and Kiplinger, a drunken driver demolishing his car after making a reasonable effort to sleep off the effects of the booze could qualify for a tax write-off, but had he driven home without taking a nap to mediate the effects of the alcohol, he would have been considered negligent.
Though IRS rules covering allowable child care deductions if a parent is leaving home to do charitable work have been debated over time, all it took was one mother on a mission to alter that language. The plaintiff may even have surprised herself when she went to tax court and judges found the woman’s philanthropic activities were such that her sitters “enabled” her work. The court rejected standing IRS policy. If you conduct charitable work requiring you to leave your children in the care of a nanny or sitter and can document the activity, a tax attorney may be able to get you the same deduction.
Sex Change Expenses
New IRS case law was established when a man trapped inside a woman’s body claimed $22,000 in out-of-pocket medical expenses resulting from having a sex change operation. A tax court upheld the $14,500 covering the required surgeries and hormone therapy but found that the cost of the claimant’s breast augmentation didn’t pass muster and wasn’t required as part of the medical claim. On the other end of the continuum, a decidedly masculine tax filer claimed that the body oils he needed to enhance his physique were legitimate expenses when he competed in body-building contests and, surprisingly, the court allowed the oil — but nixed the supplements he also tried to claim.
Based in Chicago, Gail Cohen has been a professional writer for more than 30 years. She has authored and co-authored 14 books and penned hundreds of articles in consumer and trade publications, including the Illinois-based "Daily Herald" newspaper. Her newest book, "The Christmas Quilt," was published in December 2011.