I’m sure I don’t need to tell all of our American readers that your income taxes are due on April 17 (it’s usually April 15, but since that was a Sunday this year, we got a short little extension). While you might have made some seemingly strange deductions on your income taxes in the past, chances are that you’ve got nothing on these ballsy write offs, although, surprisingly, many of them have been accepted by the IRS.
Image Via kenteegardin [Flickr]/Senior Living
9 That Have Been Accepted:
Fancy Dresses. The catch here is that the dresses that TV star Dinah Shore was able to write off could only be used on her show as they were so tight that she couldn’t even sit down on them. Being as how they could only be used for her work, the IRS let her keep the deduction.
Boob Jobs. Not just anyone can write off a breast enhancement, but if you’re a stripper who gets the surgery so you can make more tips, you might just qualify. After all, Chesty Love already won a battle with the IRS over whether or not her 56 FF enhancement should count, the court agreed that if she didn’t get them she could lose money to other dancers. This same principal applies to lingerie, make up, and other accessories that dancers in this trade might need for work, as long as they can prove the items aren’t being used for personal purposes outside of the club.
Image Via Caza_No_7 [Flickr]
Body Oil. It’s not just women who get to claim deductions related to their appearance. Professional body builders are allowed to claim (legal) products they use to keep their muscles looking great. While steroids don’t qualify, body oil and tanning sessions do.
Clarinet Lessons. Don’t get too ready to sign up for music lessons. This deduction was only allowed in one specific circumstance where a doctor recommended a patient take up the instrument because it has been known to help lessen the pain associated with an overbite. Since it was considered a legitimate medical expense at that point, the patient’s parents were allowed to write it off.
Swimming Pools. Like the clarinet, this isn’t a deduction most people will be qualified to take, but in the case of one patient with osteoarthritis, it was considered a valid medical expense. That’s because his doctor recommended he start swimming for physical therapy. After that, the installation, the chemicals, the cost to heat the pool and the insurance were all considered legitimate medical expenses. I wonder if swimming could help treat my migraines…
Image Via snowpea&bokchoi [Flickr]
Evian Water. Believe it or not, swimming pools and clarinet lessons aren’t the craziest medical deductions by any stretch of the imagination. One woman managed to get a prescription for three bottles of Evian water a day, allowing her to deduct $1,095 of bottled water from her taxes.
Cat Food. No, the IRS hasn’t started letting people claim their pets as dependents (although many people have tried), but if your business has a cat for a legitimate business reason, you can deduct the price of cat food. Unfortunately, book store kitties don’t count; the cats actually have to do something to help your company. In the case of two junkyard owners though, a kitty was able to be deducted since he helped them keep their property free from snakes, rats, and other vermin. While the IRS originally tried to fight the deduction, the tax court agreed with the couple and let them write off the price of cat food.
Image Via L'Yoshka [Flickr]
Carrier Pigeons. While most people who keep carrier pigeons these days do it more as a hobby, there are some people so distrustful of technology that they refuse to use telephones or computers. When one such person turned to carrier pigeons to communicate with his business partner who lived across town, he thought it was only fair that he get to write off the price of the pigeons, along with their food, care and housing. His CPA determined the pigeons were a legit expense, given that it was the only way the man kept in touch with his business partner.
Beer. No, you can’t get drunk and claim it was a medical or business expense, but when a gas station owner offer offered free beer as part of a promotion to entice customers, it was accepted as a legitimate business expense.
8 That Have Been Rejected:
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Therapeutic Sex. Even if sex with prostitutes can cure your erectile dysfunction and erotic massages can get rid of your osteoarthritis (as one retired lawyer claimed when deducting $113,537 worth of therapeutic sex services), if prostitution is illegal in your state, you can’t write it off because you can’t deduct illegal expenses. For the record, the same applies to medicinal marijuana, seeing as how it is still illegal on the federal level.
Drug Dealing Expenses. Speaking of drugs, if you work in an illegal industry, like, say, drug dealing, you can’t write off your business expenses. To be fair, most drug dealers don’t pay taxes, but when one drug dealer was already facing prison time, he decided he didn’t want to risk having to serve more time for tax fraud. So, he hired a CPA and recorded all of his income, which must have been difficult without any receipts or 1099s.
Recreational Drugs. It might not come as a shock to you that you can’t write off the cost of recreational drugs like cocaine or ecstasy given that you can’t write off prostitutes or the cost of selling drugs. Of course, that doesn’t mean people haven’t tried. One rock band tried to write off almost $100,000 worth of drugs as part of their “travel and entertainment” expenses. The group’s bookkeeper had concluded that for a rock band, recreational drugs are considered a necessary and ordinary expense. Fortunately, their accountant had the good sense to realize that the IRS would see things differently and removed the deduction from their return.
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Arson. If you think therapeutic sex services and drugs are ridiculous deductions, wait until you hear about the business owner who tried to write off arson as a business expense. The man hired an arsonist to burn his failing furniture store down and received $500,000 in insurance money as a result. Unsatisfied with his ill-gotten gain, the man went ahead and wrote off $10,000 for “consulting services” on his tax return and when he was audited, the truth came out that his “consultant” was actually a paid arsonist. Both of the men went to jail and the furniture store owner was also fined $6,000 by the IRS.
Babies. They already count as a dependent, so it hardly seems fair for them to also qualify as a business expense, but one woman from Arizona thought that because she used her baby in her marketing materials that she should be able to write off its clothing, food, nanny, diapers and baby powder to the tune of $26,000. While her CPA agreed that the photographer who took the pictures of the baby and its onesies that bore her company logo could count, that was about it.
Whiskey. While free beer might have qualified for a deduction, free whiskey didn’t. Of course, it was more likely a result of how the product was deducted rather than what it was. That’s because one man decided to write off the price of a few cases of whiskey he gave to clients as gifts. Unfortunately the gift violated state laws and didn’t count as “client entertainment,” the category he listed the deductions under.
Image Via flaringshutter [Flickr]
Pole Dancing Classes. These might be a great way to spice up a marriage, but you can’t write them off because seeing your wife pole dance helps you relax after work. One man tried using the deduction under the “meals and entertainment” category, but his CPA told him that the $800 classes would certainly not qualify under IRS rules.
Painting Spatulas. At first glance, this seems like it would be a reasonable deduction for a painter. Unfortunately, while you can write off tools of your trade and you can write off business trips, you can’t take a vacation to Brazil, buy some spatulas while there and consider it a business expense.
I know we probably have some accountants that read our site. Do any of you have any tales of crazy tax deductions? Of course, you regular readers are invited to include yours as well, but please don’t mention anything that’s liable to get you in trouble if it caught the attention of the IRS. I certainly don’t want to be responsible for someone getting audited.
Sources: Mental Floss, Turbo Tax Blog, PT Money, CNN, Wise Bread and Bank Rate