It’s that time of year again: tax season, one of only two things in this world about which you can be certain. As a committed pet owner, you may wonder if you can write off some of the many expenses required to care for your animal companion. The answer? Probably not. However, under certain specific circumstances — generally business, medical or charitable — there may be deductions available to you because of your pets. We have the tips to help you and your furry friends possibly save yourselves a little bread. Just remember to consult a tax professional first to see if you qualify for any of these tax deductions. You don’t want to start a fight with Uncle Sam and the IRS.
The costs of adopting a pet are almost certainly not deductible. However, there is some gray area if you adopt through a non-profit animal shelter. As non-profit organizations, these facilities provide the animal and some of its initial medical care, including spaying or neutering, free of charge, usually along with a “suggested donation” that they may recommend to help cover costs. Because the money you give in such a situation is technically a donation and not a fee, it may be eligible for a write-off. (Dogster)
Charitable donations are often tax deductible. Did you donate a lot of money (or even a little) to an animal-friendly organization this year? You good person, you! Claim your reward: Write it off. This could include anything from donations to wildlife conservation organizations to giving a few ducats to support the local shelter where you adopted your pet. Double-check to make sure whichever groups received your donations are non-profit. (Care2)
If you breed pets as a business and not just a hobby, you may be able to deduct the expenses related to the business, possibly even a portion of home expenses (if you use part of your home exclusively for the purpose of breeding). Note that the IRS will not allow you to claim business losses related to animal breeding for more than three years in a row. (Yahoo Voices)
If you pay for yourself or a dependent to buy, train and care for a medically necessary service animal, e.g., a seeing-eye dog, you may be able to deduct the costs as a medical expense, although it may depend on how much it costs you as a percentage of your total income. You also likely will need to provide documentation that your service animal is medically necessary. Service animals for physical and mental ailments may be eligible. (The Wall Street Journal)
If you and/or your pet are involved in the entertainment business, a portion of the expense of caring for your pet could be considered a business expense. Your pet could be an actor, or perhaps the two of you have a stage act. If you have a single YouTube video of your pooch, that probably won’t count, but if your pet becomes a viral mega-sensation to the extent that you can establish a full-time business marketing and selling its image to an entertainment-hungry Internet audience, you may have a case. (Dogster)
The government typically considers pets to be property, not dependents. This may be an odious concept to many animal lovers, and it can be very inconvenient in certain legal struggles involving pets, but you can make it work for you at tax time. If you’re required to move for a job, you may be able to deduct certain costs of the move, including the costs of moving your pets, since pets technically are your family’s property. (TurboTax)
In a landmark case just last year, the U.S. Tax Court ruled that a woman was eligible to deduct the expense of caring for more than 70 cats as part of an IRS-approved charity. The ruling set a new precedent, and was big news for people who offer their time and money to provide foster care for pets. To write off the expenses of foster care, you will need your activity to go through a qualified organization and provide thorough documentation. As always, consult a professional to determine whether or not you qualify. (GalTime)
If you keep an animal as a useful and necessary part of your business, you may be able to write off its costs as a business expense. Examples include guard dogs, or animals that keep vermin at bay, such as a cat that kills mice or snakes. If the animal doubles as your personal pet outside of your business, you will probably have to figure out which of its expenses pertain specifically to your business, as only those will be deductible. (MainStreet)
Next: What Will a Dog Cost You Over Its Lifetime?
This one isn’t official yet, but new legislation has been proposed in California to provide a tax break to pet owners who buy medicine from their veterinarians. Many pet owners prefer to buy medicine generic or otherwise from online outlets, because it’s often cheaper than getting meds from the vet. That’s because vets are required to pay sales or use tax on their purchases of drugs and medicines, and these costs are passed on to patients. The legislation would establish a sales and use tax exemption for drugs and medicines used, supplied, or sold by licensed veterinarians, government-run animal shelters, or nonprofit animal welfare organizations, in order to save you the extra taxes so you don't have to shop online. (Central Coast News)