Pet-related Tax Deductions
While you cannot claim your pet as a dependent on your income tax return, there are some legal pet-related deductions you can take - if you do it right and keep good records!
Well, April 15th is behind us - Tax Day (although this year the actual deadline is April 18th.) Many pet owners wonder about claiming their furry family members as dependents. Maybe not, but there are some legitimate pet-related tax deductions, under the right circumstances.
If you have a service animal, such as a guide dog, or another animal to assist a person with physical disabilities, you can include in your medical expenses costs to buy, train and even maintain the animal.
If you have an animal-related business, such as a pet trainer or breeder, you can deduct business-related expenses. Those expenses are deducted on Schedule C.
The IRS considers your animal friend part of your personal effects. So if you move during the year, and special arrangements are necessary to transport your pet from your old house to your new one, you may be able to deduct special moving expenses for your pet.
Pet adoption fees generally are not deductible, even if the adopting organization calls them “adoption donations”. However, if you make a contribution to the organization that is over and above their usual adoption fee, that part might be deductible.
In 2011, the Tax Court ruled against the IRS and in favor of a California taxpayer who deducted a sizable amount for “unreimbursed volunteer expenses while caring for foster cats in her private residence”. Since then, animal rescuers across the country can claim deductions for expenses paid while fostering animals for an accredited not-for-profit organization. If you want to claim this deduction, you must keep good records and receipts; and if your deduction is more than $250 in one tax year, you will be required to have a letter from the not-for-profit organization that confirms your status as a volunteer who fosters animals for them.
It may be a too late to claim a deduction for last year, but tax time is a great reminder to keep receipts and good records so you can claim them on this year’s return. You get a tax break and maybe help an animal, and everybody wins – when you’re speaking of pets.