As we noted in our last post, deductions can help you reduce your gross income as you work towards reaching your taxable income. It is this definition of “income” that will determine how much in taxes should be paid. This could result in you getting a refund check from Uncle Sam, or writing him a check.
Either way, deductions are important; so much so, that some people may try to bend the rules as to what qualifies as a deduction. This post will highlight some of the more “interesting” expenses taxpayers have attempted to gain deductions from.
Cat food and litter – Indeed, cats may keep mice out of your home, so they may be viewed as pest control. However, the IRS doesn’t agree. So costs related to cat food and kitty litter may not be deducted as an expense.
Disneyland season passes – Yes, taking the kids to the “Happiest Place on Earth” can pacify even the pickiest child, but season passes to Disneyland do not qualify for a day care deduction.
Gambling losses – Since you must report gambling winnings to the IRS, one might think that significant losses may qualify for a deduction. Unfortunately, the IRS does not agree. If this were the case, everyone would play the lottery.
Expensive clothing – If you bought a new suit or dress as part of your efforts to find a new job, this may be deductible. However, buying a new wardrobe may not pass muster as a deduction.
If you have additional questions about deductions, an experienced tax attorney can advise you.