At the end of July of 2009, Rep Thaddeus McCotter revealed the Humanity and Pets Partnered Through the Years (or HAPPY Act) bill. The HAPPY Act aimed at making it possible for a tax deduction of up to $3,500 each and every year for animal and pet care-related expenses. The current status of this bill as of the time of this article: “Referred to House Committee on Ways and Means.” It appears that this is not the top priority at the House of Representatives, you might possibly have a divergent view on that.
So what kind of animal- and pet-related expenditures are eligible for a tax write-off?
It has been said that dogs have owners and cats have attendants, regardless. Our dogs and cats are dear to us. Some of us may claim our dog or cat worth its weight in goldunmeasurable). But, pet-related expenses are, in certain circumstances, eligible for tax write-offs. For instance, when moving, a pet owner may file for a tax write-off specifically for the expenses borne by moving a family companion, in tax law in this circumstance, a pet can be treated as a personal belonging, and therein our pet cat or dog is treated in such a manner.
Also a company may very well be able to write off for the expenses related to having a guard dog. Also a voluntary host of an animal that serves a theraputic function, for example an allergy-detecting dog, may be able to deduct the vet expenses, and such other unreimbursed expenses (thought of as charitable donations). There have also been court of law rulings which have favored tax deductions for expenses associated with the keeping of animals which serve hearing-impaired, visually-impaired, and physcially-impaired persons. And there are as well tax write-offs in costs related to the care of animals considered part of an animal-breeding business.
Van Dunsen vs Commissioner
In 2004, Ms. Van Dusen lived with over 70 cats and kittens (7 of them she considered personal pets). She volunteered for a charitable organization (called “Fix our Ferals”) with the intention of neutering wild cats. The volunteer deducted $12,068 on her tax return. The Irs argued that the tax payer was rescuing cats of her own volition rather than as a volunteer of a charitable organization. The tax court rejected this portrayal. The court did agree with the IRS, however, that some of the expenses (such as State Bar Dues and Costco membership dues) would not fit as exclusively charitable expense.
Ultimately, all of the individual expenses that exceeded $250 were disallowed considering that Ms. Van Dusen failed to provide the proper verification for such charitable donations (such as a contemporaneous written acknowledgment from the donee.) For the write-off to be allowed, the donee must file a return with the IRS reporting the similar info comprising the written acknowledgment, such as: 1) the amount contributed; 2) a description and good-faith estimate of any goods or services received in exchange; and 3) if the donee delivers any intangible or religiousbenefits, a statement to that effect). If you would like to write off the expenses for your seventy cats, make certain you are acting on part of an appropriate charity and be sure you receive the needed documentation.
How can I differentiate between tax deductable and non-tax deductable animal and/or pet care-related expenses?
So you see there are prospects for tax write offs associated with the expenses borne by the care of animals. And there are cases when these expenditures are non-tax deductable. If you are contemplating a tax write-off related to the expenses of taking care of animals or pets, seek the advice of a certified public accountant (CPA). Don’t assume that just because your friend owns 20 or so cats, he will be able to provide you with qualified animal- and pet-related tax deduction information and advice.
In a peculiar instance, a landscaper attempted to deduct for the expenses of caring for a dog which assisted him in pulling a cart while at work, likely without the counsel of a accountant. This awarded the gardener/landscaper an Internal Revenue Service review. We could possibly assume this brought about some working-relations strain, yet we are unable to verify this possibility. Nor is it likely that either the employee or boss will go on the record anytime soon.