Ah, January, a fresh start, new resolutions, and…taxes. They’re a hot topic this year with so many credits and deductions expiring. But let’s take a break from all of the Taxmaggedon and Fiscal Cliff talk that we’ve been hearing about since the Presidential campaign trail. As you start to get your paperwork together and figure out your itemized list for the year, check out some of the craziest things taxpayers have tried to deduct at tax time, and whether or not they succeeded.
- One taxpayer tried to write off an unusually high amount of medical expenses, including an $8,000 hip replacement for “family dependent.” The taxpayer was unmarried, had no children, and was not a caretaker of anyone. Turns out, the dependent was her dog! This was not deductible.
- If you’re an aspiring bodybuilder, well, we have some good news for you! The oil bodybuilders bathe themselves in before competing is a deductible business expense. A part-time bodybuilder won a case against the IRS in 2004 making this deduction legit. So, bodybuilders, save those receipts!
- A tax lawyer, ironically, once tried to deduct more than $65,000 in one year on prostitutes and pornographic materials. He tried to claim the $65k as a medical expense—sex therapy (I’m not kidding). The conduct was not only illegal, but wasn’t allowed as a viable tax deduction.
- A man in Texas was tired of his noisy neighbor, so much so that he bought the house from him, ripped it out of the ground, and donated it to a local women’s shelter. The Texan was able to deduct some of the value of the house as a charitable contribution.
- Ever try to deduct your boyfriend or girlfriend? One man did. He hired his live-in girlfriend to manage several of his rental properties. She was responsible for finding furniture, making sure repairs got done, and running his “personal household.” He ended up being able to deduct as a business expense $2,500 of the $9,000 he paid her, but wasn’t allowed to deduct the cost of her housekeeping chores as nondeductible personal services.
So there you have it. Whether you itemize or not, be sure to check out all of the offers our tax partners have available for this tax season.