Believe it or not, there are some pet-related expenses which may be deducted from your taxes. Here is a summary of such expenses. And you thought all you were ever going to get out of this relationship was love, affection, and undying loyalty!
Medical Expenses
Taxpayers may include the expenses of buying, training and maintaining guide dogs used for assistance in cases of either reduced vision or hearing. This may include all necessary food, training, grooming and veterinary care. You may also deduct this expense if you’ve been diagnosed with a physical or mental condition that benefits from the attention of a trained therapy animal. Keep in mind that unless the animal is trained or certified as treatment for a diagnosed illness or condition, the IRS will disallow any deduction.
Business Expenses
Guard dogs that are used for security may qualify as a business expense. It must fit within the definition of an ordinary and necessary expense in the line of business. If this is the case, then all of the animal’s food, training, grooming and veterinary care would be deductible as a business expense. As is always the case, be prepared to provide full and accurate records of the use of the animal as a security device.
Don’t forget that like most forms of business property, the dog’s cost must be allocated over its useful life. You must depreciate your dog! This expense is also is more likely to be allowed with some proof of the animal’s contribution to the business enterprise. It’s also better if the dog is of a breed that is commonly used for the same business purpose. For example, using a Rottweiler or Doberman for security or an English Sheepdog for herding.
Moving Expenses
According to IRS Publication 521, taxpayers may deduct the cost of shipping household pets when they move. The deduction for moving costs is an above-the-line deduction which requires the use of the long Form 1040 and Form 3903.
Hobby Expenses
This may be a little more difficult to use as a viable deduction since hobby-related earnings are taxable income. Yet the expenses of the hobby may be used to offset hobby earnings. Such expenses must be itemized with other miscellaneous deductions on Schedule A, and that total must exceed 2% of adjusted gross income to be deductible.
Charity Expenses
Donations of time and money to a charity like an animal shelter may qualify as charitable donations under the Internal Revenue Code. Unreimbursed expenses like food, supplies and veterinary bills related to fostering a pet through an IRS qualified 501(c)(3) non-profit organizationmay be deducted. A deduction may be taken of fourteen (14) cents per mile for trips made in furtherance of any 501(c)(3) work. These costs and direct donations may be itemized under the charity section of Schedule A. As always, keep detailed and accurate records. Also, a letter from the charity acknowledging any volunteer work is an excellent and necessary piece of proof.
If you are a pet owner in the Tri-State area and have a question about a pet-related expense, call THE TAX EXPERTS at the Thorgood Law Firm www.thorgoodlaw.com. For a FREE consultation call 212-490-0704.
