We all joke about deducting our dogs and cats as dependents. But there are times when having a pet could lead to a tax deduction. If you have a service animal or guide dog, you should be able to deduct the costs associated with buying, maintaining, and training it. This, too, would be considered a medical expense.
. Parents were able to deduct the cost of a clarinet and clarinet lessons to help with their child’s overbite.
. There’s a famous case where a junkyard owner was able to deduct the cost of the cat food he put out to attract feral cats. The felines took care of pest control for his business. You may also be able to deduct some pet care costs if your dog or cat becomes an internet sensation and you’ve set up a business for it.
Travel and meals
. Millions of people have taken on side gigs because of the pandemic economy of the last two years. Some have parlayed this work into full-time businesses. And some of their unusual expenses are legitimate business deductions. For example, there’s the case of the travel writer who was able to deduct 30 percent of her honeymoon costs because she blended it with her work. Or the video blogger who claimed the costs of an RV. This kind of deduction only works if you can show the IRS proof that you produced paying work from your travels.
You may never have considered some of the expenses your small business can deduct. But the IRS makes a sharp distinction between a business and a hobby.
. You’re using your personal vehicle for a legitimate business, so you can deduct many expenses, including mileage, actual car expenses, fees and commissions, cell phone charges, and vehicle accessories – but you’ll have to determine what percentage of these are used for your rideshare driving.
. Two more famous cases involve the bodybuilder who claimed a deduction for body oil and the exotic dancer who did the same for cosmetic surgery.
Miscellaneous, Obscure—But Legitimate—Deductions
You’re not likely to be claiming any of these, but they just go to show that the IRS tax code contains myriad unusual deductions:
Digging for Deductions
- Have a friend who made less than $4,300 in taxable income who crashed on your couch for a full year? You may be entitled to up to $500 in dependent credit.
- Did you loan someone money that never got paid back? If you can prove you tried to collect, you can write off up to $3,000 per return.
- If you live in Hawaii and have what’s considered an “exceptional tree,” you can claim up to $3,000 per tree, once in a three-year period.
- Some cities in the Northeast are giving homeowners tax breaks for maintaining homes in historical areas.
- Starving artists can get an above-the-line income adjustment if they have W-2 income and their art is a side gig.
- Whaling ship captains can claim up to $10,000 for ship repairs.
We’re not suggesting you try deducting some wacky expenses on your 1040 this year. But we are
suggesting that you let us help you find every deduction and credit that’s allowable. It’s a busy time of year, of course, but contact us if you need tax prep help, and we’ll see how we can assist.
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If you haven’t finished your income taxes yet because you’re not sure what you can deduct, contact us.
The IRS tax code contains some very obscure but legitimate deductions. Are you claiming everything you could? Let us help.
You may be able to claim some unusual medical expenses if a doctor prescribes them, like a home swimming pool and weight loss aids.
Rideshare drivers can deduct a surprising amount of expenses on their tax returns. We can spell it out for you.