Tax Write-offs : A Guide for the Pet Owner

At the end of July of 2009, Rep Thaddeus McCotter presented the HAPPY Act (Humanity and Pets Partnered Through the Years) bill. This bill aimed at permitting a tax write-off of up to $3,500 per year for pet-related costs. The status of this bill at the date of this writing: “Referred to House Committee on Ways and Means.” It appears that this isn't the number one priority at the House of Representatives, you could have a difference of view on that.

What kind of animal- and pet-related expenses are tax deductable?

The family pet is dear to us pet owners. Some may think our pet worth its weight in gold (this is a figure of speech). But, did you know that pet-related expenses are, in a few circumstances, tax deductable. For example, when relocating, a pet owner can file for a tax write-off for the costs borne by relocating a family cat or dog, in tax law under these circumstances, a pet may be viewed as a personal belonging, and therein our pet cat or dog is treated likewise. 

A business may very well be able to deduct for the expenses of having a guard dog. And a voluntary sponsor of a therapy animal, for example a guide dog, could possibly be able to write off the vet expenses and bills, and such other unreimbursed expenses (these are considered charitable donations). And there have similarily been tax law rulings that have allowed tax write-offs for expenses associated with caring for animals that serve the hearing-impaired, visually-impaired, and physcially-impaired persons. And there are as well tax deductions in expenses related to keeping animals considered part of an animal-breeding business. 

TheCat Lady Case--Van Dunsen vs Commissioner

In 2004, Ms. Van Dusen cohabitated with 70 - 80 felines (7 of which she counted as personal pets). She was a volunteer for a charity "Fix our Ferals" with the primary goal of fixing feral cats. The volunteer deducted a little over twelve-thousand dollars on her return. The IRS argued that Ms. Van Dusen was rescuing cats by herself rather than incurring expenses as a volunteer for a charity. The tax court refuted this coloring. The court saddled with the IRS, however, that a lot of these expenses ( wet/dry vacuum repair cost, DMV fees, Costco membership dues, and State Bar Dues) wouldn't fit as exclusively charitable expense. 

Lastly, all of the individual expenses exceeding $250 were disallowed because Ms. Van Dusen failed to provide the required verification for these charitable donations (that is to say, a contemporaneous or simultaneous created verification from the donee organization.) For the write-off to be allowable, the donee must also file a return with the Internal revenue service reporting the equivalent information comprising the written acknowledgment, such as: 1) the amount of cash contributed; 2) a description and good-faith estimate of any services or goods acquired in exchange; and 3) if the donee delivers any intangible benefits, a statement to that effect). So if you want to deduct the expenses for your 50 cats, make certain you are acting on the part of an proper charity and make certain you acquire the required documentation. 

How do I determine the difference between non-tax deductible and tax deductable animal care expenses?

So now you know there are possibilities for tax deductions associated with the expenses incurred by the care of pets and animals. And there are times when these expenses are non-tax deductable. If you happen to be making plans for a tax deduction related to the expenses of taking care of animals, seek the direction of a CPA (certified public accountant). Do not expect that because your friend owns twenty cats, he can supply you well-informed pet-related tax deduction information and advice.  

In a strange case, a gardener and landscaper tried to write off for the expenses of taking care of a dog which helped him pull a cart while on the job, most likely without the advice of his accountant. This granted the landscaper an IRS review. We can assume that this prompted some working-relations strain, however we are unable to verify this notion. Nor is it likely that either boss or employee will provide testimony anytime soon.