No, your husband is not deductible ... and other IRS tales
Claiming the cat spa or ugly suit? Amazingly, the IRS sometimes says yes.
When it comes to tax write-offs, there's no end to people's creativity.Skip to next paragraph
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Everyone knows the Internal Revenue Service won't allow you to claim a trip to the day spa as "preventive medicine" or your dry cleaning bills as a business expense. But consider the woman who wanted a charitable deduction for donating her husband (that's how she phrased it on the form). The tax analyst was left to assume she meant that his time had been given to a cause - which is nice, but not deductible.
For all the cautionary tales, there are missed opportunities, too: Only about one-third of taxpayers itemize their deductions. H&R Block estimates that the average person loses $400 in overlooked tax breaks every year.
So as Thursday's deadline approaches for filing your return, go ahead - dare to dream. Tax preparers will thank you, because without their help, you'll have difficulty discerning which weird ideas actually pass muster and which are just outlandish.
Here's a quick quiz. How many of the following expenses can be written off: (a) your dog, (b) your suit, (c) a business trip paid for entirely in cash. You're probably expecting (d) all (or none) of the above, but here's an even more annoying answer: (e) It depends. (You'll have to keep reading if you really want to know.) Many have tried but few have succeeded in deducting pet expenses. "If you've got a real business that requires a guard dog, you're cool, but if IRS [agents] actually meet that guard dog and the dog goes and licks them in the face, you have blown the deduction," says Eva Rosenberg, an expert in Las Vegas who calls herself the Tax Mama.
Boarding your pet while you're away on business does not count as a business deduction. On the other hand, H&R Block reports, if you relocate for business and it costs extra to move the pet, that's legit. And a write-off for pet food was allowed in order to attract wild cats to a scrap yard to keep away the snakes.
Now, how about that wardrobe? If you have to wear suits to work, you can't deduct them as a business expense. But it's a different story for uniforms and other clothes that you can't reasonably be expected to wear in any situation but your job.
"I had one guy who had a lime green suit that he used for some promotion [for his business]," says Michael Cobb, spokesman for the tax committee of the National Association of Black Accountants in Washington. "The IRS tried to disallow the deduction and his argument was, 'I'm not going to wear this lime green suit out in public!' ... We won, because nobody would ever wear anything like that."
Mr. Cobb also attended an audit with a woman who had deducted $5,000 worth of donated clothes. As a lawyer who frequently buys designer brands and then gives them away in good condition, she had her argument prepared.
"She was saying, 'I wear expensive clothes; I don't wear polyester,' " Cobb recalls. "I was trying to keep a straight face, because ... the guy had on a polyester jacket." If the IRS official took offense, he didn't show it: He granted 80 percent of her claim.
Determining the fair market value of donated items is notoriously tricky. Bill and Hillary Clinton were taken to task for valuing used underwear at about $2 apiece on a tax return.