Who knew the IRS could be so lenient?
Tax season has arrived, and while some of us are just hoping for a refund large enough to justify a vacation, others see filing taxes as a full-blown contortion act—an exercise in testing the tolerance of the IRS. I spoke with tax professionals, Doug Birch and Matthew White, managing director and senior manager of CBIZ MHM Tampa Bay, respectively, about their take on tax season and some of the crazier tax write-offs they’ve come across. Birch and White shared stories of people who had tried to take deductions and failed. There was the guy who tried to take a deduction after burning his own business down, and the woman who claimed her wedding was a business expense because she invited business contacts. But they also shared with me some of the surprising write-offs people have gotten away with, and here are the seven craziest:
Tight clothing
If you can prove that certain pieces of clothing are exclusively worn for work, the IRS will allow you to deduct their cost. Birch and White mentioned having personally done this for professional clowns and Elvis impersonators, but the most famous example, they told me, was celebrity Dinah Shore. Shore deducted the cost of the formal dresses that she wore on her television show, because she argued they were too tight for her to sit down in and, thus, were worn exclusively for TV. The deduction was allowed, but rumor has it that the IRS sent a judge to confirm her claim about their tightness.
Breast implants
This wouldn’t work for just anyone, but an exotic dancer, “Chesty Love,” was able to write her breast implants off. She could prove that the implants were directly responsible for her earning more as a dancer, and the IRS accepted the write-off.
Gambling losses
If you keep immaculate records you may be able to deduct your gambling losses. The IRS will allow it, but all deductions must be carefully itemized—each deduction must include the date and type of gambling engaged in, the name and address of the place you gambled, the people you gambled with, and the amount won and lost.
Clarinet lessons
White and Birch explained that medical expenses are one of the places people can get away with more unusual write-offs. There have been cases where clarinet lessons were successfully deducted, because a doctor recommended them to help fix an overbite.
It's not about the tax return it's about the tax journey— freddy (@freddy) 1489541871.0
Swimming pools
Swimming pools are another expense White and Birch mentioned will be approved if it’s per doctor’s orders. If that sounds too good to be true, the cost of maintaining the pools—chemicals, heaters—can also be deducted with the proper medical documentation.
Free beer
A gas station owner was able to deduct the beer he gave away in the name of marketing dollars well spent. The court case notes read, “Since many of his customers were oil field workers, it was suggested to the petitioner that he would get more business if he would give free beer to his customers rather than S&H Green Stamps.” Because his business did, in fact, increase, the deduction was allowed.
Body oil
Professional bodybuilder, Corey Wheir, was able to deduct the cost of body oil. As we all know, body oil is paramount to one’s success as a body builder, obviously.
When I asked Birch and White how they reacted when clients came to them with unorthodox write-offs, they agreed that it was surprising what you can get used to.
“You find yourself becoming ok with it,” Birch said of unusual deductions. “What at first sounds crazy becomes reasonable when you’re able to find a precedent in the tax courts.”
They both stress that, if it’s a gray area, the client needs to understand the risk and be able to defend their case. So if you’re thinking of deducting cat food or your live-in significant other, be prepared to argue your case. Or consider Birch and White’s advice that “the things people will fight tooth and nail for often don’t even amount to a benefit at all.”