As a general rule, your federal income tax form is one of the last places where you should say, “Heck, let’s try it and see what happens.” The Internal Revenue Service (IRS) isn’t noted for its madcap, devil-may-care attitude.
Nevertheless, people do try to take unusual tax deductions. Sometimes the IRS allows them. Sometimes tax court allows them. “Oftentimes, it seems like it’s the IRS denying it and then the tax court allowing it,” says Mark Luscombe, principal analyst at Wolters Kluwer Tax & Accounting. Here’s a look at 10 of the most unusual tax deductions the IRS has allowed.
1. Animal expenses
Owning a pet for emotional support may ease your anxiety, but that’s not a legitimate reason for deducting Fluffy’s food, litter and veterinary bills. A bona fide service animal, such as a guide dog used by someone who has a visual or hearing impairment or a physical disability, is another story. The cost to buy, train and maintain (food, grooming, vet care) a service animal under these circumstances is generally deductible as a medical expense, according to IRS guidelines. And if a cat keeps your business free from rats, you might be able to deduct some of the expenses for its care. “If it can be associated with some sort of income, [it] was allowed,” Luscombe says.
2. Body oil
OK, most of us can’t deduct the cost of body oil, no matter how great it makes your skin feel. But what if you’re a bodybuilder? It takes a lot of oil to make your body shine like that, and it’s a legitimate expense for professional weight lifters.
3. Clarinet lessons
In 1962, a parent deducted the cost of clarinet lessons for her child, says Lisa Greene-Lewis, CPA and tax expert with TurboTax. The reasoning: An orthodontist said it would correct the child’s overbite. The IRS allowed the deduction as a medical expense.
4. Cosmetic procedures
The IRS will allow you to include cosmetic surgery in your medical expenses if it is necessary to improve a deformity from (or directly related to) a congenital abnormality, an injury from an accident or trauma, or a disfiguring disease. “There was a case where an exotic dancer, known as Chesty Love, tried to depreciate her breast implants on her taxes,” Greene-Lewis says. “The IRS initially blocked the depreciation deduction, but the U.S. court ruled that the breast implants can be claimed as a business deduction.”
If you have mobility problems and can’t leave your multistory house, an elevator is a reasonable solution — and a deductible one, says Melanie Lauridsen, director of tax practice and ethics with the American Institute of CPAs. Two hitches: First, this is a medical deduction. You can only use the amount of total qualifying medical expenses that are above 7.5 percent of your adjusted gross income (AGI). Second, if the elevator increases the value of your property, you must subtract that amount from the amount you deduct. The same rule holds true for swimming pools.