Here at ABA Tax Planning, we love our furry staff members - we even incorporated one of them into our logo! As a result, we attract a lot of clients that love animals. So of course we get this question about writing your pets off as a tax deduction a lot. In most cases, pets are not a tax deduction, at least not in the same capacity as a human dependent. However, there are some cases in which writing your pet and their living expenses off can be legal.
If you run a business, you may be able to deduct certain expenses related to your pets if they are directly associated with your business operations. A common example is if you own a guard dog for your business, the costs of food, grooming, and veterinary care may be deductible. The dog must be a breed that is capable of guarding (so no writing off your pomeranian as a business expense), but more importantly, they must remain on the premise of the business. So if you take your pet home with you at the end of the workday, the IRS considers them a pet and not a guard dog. Other common business uses for a pet would be a cat who is used to control pests in a store, a therapy dog at a psychologists office, or a tracking dog used in search and rescue. Unfortunately, our door greeter, Sidonie, is a pet in the eyes of the IRS and not a business expense, but we still love her.
While Sidonie is all about that couch princess life, her breed the Great Pyrenees is commonly used as a livestock guardian dog. If you use your dog for farming and herding activities, they may be deductible as a business expense for your farm. The farm would need to be a legitimate business with steady income and not a hobby or a tax shelter. You would also need to keep careful records to prove that your dog is primarily used on the farm in order to support the deduction. This isn’t limited to dogs either. If you own a farm and it is a legitimate business, then you can write off most animals purchased as a business expense, including cows, horses, rabbits, sheep, and pigs. As long as the animals have a business purpose, you can make a strong case for their deduction.
If you have a service animal that assists you with a disability, the costs associated with the care of that animal may be deductible. This includes veterinary bills, food expenses, and training costs. You’ll need to provide documentation to prove the necessity of the service animal and the related expenses. The deduction would be an itemized deduction as a medical expense so there are limitations for those expenses, but I have had some clients who were able to deduct these expenses.
If you donate to animal charities or shelters, you can deduct those contributions from your taxable income. This includes monetary donations, supplies such as food, toys, or bedding, and costs related to fostering animals for a charitable organization. Make sure to keep records of your donations for tax purposes. And again, donations are an itemized deduction, so donations along with the rest of your itemized deductions would need to exceed the standard deduction in order to be deductible.
While pets are often considered personal companions, there are legal ways to write off certain pet-related expenses on your taxes. Always consult with a tax professional to ensure you’re following the law and maximizing your deductions. By keeping detailed records and understanding the specific circumstances under which pet expenses can be deducted, you can enjoy the benefits of being a pet owner while also easing your tax burden.
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