This post is about some hard-to-believe facts around tax exemption. You have sufficient time in hand to prepare for next year’s tax return. Now is the time to start thinking about your current and potential expenses and their impact to your taxes. You can write-off many more than you could ever think.
With all the talk of loopholes and special interest for the rich, it is rich to know that the average person has no idea what the pages of the tax code really say.
Most of us are completely unaware of the ridiculousness of what lies within the pages of the thousands page document that spells out how we pay back to society.
The problem? They aren’t just a joke; they are the ways that people have been allowed to use the system
A stripper who was finding that her tip jar was not as full as she would like it to be decided to invest in her business by getting implants. Realizing that breast implants are cosmetic surgery and not considered a legal deduction, she went overboard literally. Increasing her bust size to a whopping 56 double FF, she claimed that the implants were depreciating assets on her IRS return. When she was questioned, the courts sided with her tax deduction using Hess v. Commissioner. Since her breasts were legally termed a “stage prop,” the courts sided with her and let her write them off.
When a guy named Bruce wanted his girlfriend to purchase furniture for him, be the manager of his rental property, and to run all of his personal household management details, the IRS called him out on it. So, Bruce decided to take the IRS to court. The court found in favor of his attempted deduction, claiming that part of what he paid her to do the work was considered a business expense. The only thing that he could not write off were the chores that she did for him around the house.
A woman who loved her cats in California tried to write off her exuberant vet bills and cat food costs as charitable donations. Shockingly, she won, and all the expenses of her cats were written off. If you find that you are being relocated to another job, likewise you can write off the animal moving expenses, The best part? Pets are not even held to the same alternative minimum tax as other moving expenses; it comes right off the top.
Keeping with the same theme, when a couple owned a junkyard, they decided to put out food for the neighborhood cats to keep the critters out of the business area. They wrote off the food that they contributed to the neighborhood cat, rat, and snake population, claiming that it was a business expense. The IRS tried to call them out and insist that they were wrong. The verdict? The courts saved the day and allowed them to take the write-off.
A man who was out drinking heavily one night made the poor decision of getting behind the wheel and driving. Unfortunately, he hit something and damaged his car. He was then arrested for drunk driving, which meant that the insurance company was not beholden to pay for the repair of his car. What he did then was to pay out-of-pocket and make a claim on his return that it was a casualty loss. Although the IRS called foul, the court said: “go ahead.” It was allowed, and he got his car fixed for free.
Want a new pool? A man was diagnosed with emphysema and the doctor advised that he take up swimming to improve his lung function and increase his health. He quickly went to work on a pool for his backyard. Since he claimed the primary purpose of the pool’s construction was medical care cost, he was able to write it all off as a deduction. Not only the pool itself was taken as a write-off so too was the cost of keeping it toasty for his swimming and the chemicals to ensure that it was crystal clear.
There are many things that if you sway one way or another you can make it fit whatever you are trying to. The IRS is usually into duping us all; it is nice that sometimes they get duped themselves.
Readers, do you anticipate any such deduction next year? Share your opinions with us.