Taxes--They’re one of the few things that are certain in life. And as we aim to make the most of our annual returns, you may be pleasantly surprised to hear about some of these strange but true tax deductions that get the thumbs-up from Uncle Sam.
First, man’s best friend or furry feline could earn you a tax break under certain conditions. Examples include animals related to medical or security needs such as guard and special needs dogs.
“You cannot deduct a pet if it’s just a household pet,” says Wilma Hayes, a tax professional with H&R Block. "But you can deduct pets that are a part of your business. You have to register that pet with an agency declaring that it is a service animal. The animal can be used for a guard or can be used for medical purposes,” she says. In these cases you can write off expenses such as pet food, training, medication and vet bills. Just make sure you have an official doctor’s note.
Weight Loss Plans
Speaking of health, there are quite a few more medical expenses that, oddly enough, can be deducted. Out-of-pocket costs that exceed 7.5% of your adjusted gross income can help to lower your tax bill. For example, the membership fee to a weight loss program. Just don’t forget to get a doctor’s letter with specific details and instructions to back up the claim.
“The doctor’s note actually has to be a plan,” says Hayes. “You just can’t say ‘I want to join Weight Watchers and lose a few pounds.’ It has to specify that the weight is causing you problems and you very well could lose your life from it.”
If a doctor prescribes an alternative healing treatment or therapy for your illness, such as swim lessons, that’s also an eligible tax deduction. In fact, you can even deduct the cost of building a pool or spa at your home, as long as it’s deemed medically necessary.
Finally, expenses related to helping out a charity carry some tax benefits of their own. For example, hiring a babysitter while volunteering, the ingredients you purchased to prepare meals for a local soup kitchen and even the mileage getting to and from. Just remember to keep a paper trail.
“What you need to do is make yourself audit-proof,” says Hayes. “The documentation is extremely important. The IRS could very well deny you the right to have a deduction if you don’t the documentation.”
As always, we want to hear from you. What are some other out-of-the-box tax breaks you’ve successfully earned? Connect with me on Twitter @farnoosh and use the hashtag #FINFIT.