Are Your Pet’s Expenses Tax Deductible?
The non-passing of the HAPPY Act (HR 3501) at the end of the 111th Congress left a lot of pet owners sad. If enacted, the bill would have given a $3,500 tax credit to pet owners with qualifying expenses. And the depression grows around this time of year when many of us are treading in piles of receipts and credit card bills in an attempt to itemize and deduct all that we can. Adding up pet care costs can be disturbing. It’s one of those things that you may not really want to know, if you want to stay in love with your pet.
As important as our pets are in our lives, nothing raises an accountant ‘s hackles more than seeing “four dependents” listed on the tax return of a single man with a dog, two fish, and a ferret.
So, you’ve heard it before, and you’ll ask it again this year and probably again next year, but here is the answer you don’t want to hear: Your pets are not deductible. Their healthcare is not deductible. Their food, leash, sweater, exercise equipment, and bones are not deductible.
It may cheer you up to hear that there are some pet deductions that are legitimite. Here are some good ones to discuss with your accountant—not your friend from the dog park, your accountant:
1. Pet moving costs
Here’s where your pet is considered to be a part of the family…the family property. If you qualify for moving expense deductions (i.e. if you move because you changed jobs), then moving expenses are deductible, including the cost of moving pets.
2. Seeing eye/service dog
The law allows for: “The costs of buying, training, and maintaining a service animal to assist an individual with mental disabilities may qualify as medical care.” This isn’t just your pet who keeps you company when your buddies are all out of town. You have to prove the service animal is being used primarily for your illness. Be sure to have a medical doctor’s note in your files.
3. Guard dog
This is primarily for home-based businesses. Caution: as protective as your Pekinese can be, the IRS may not be too impressed with him or your very moody cat. A guard dog should be registered, trained, and of a likely breed (German Shepherd, Rottweiler, Doberman, etc).
4. Donations to animal shelters
While adoption fees are not deductible, money that you donate to the shelter out of gratitude may be. Be sure to check with the organization to clarify its non-profit status.