Surprising tax deductions: Deductible items the IRS has allowed
Business expenses, charitable donations, and retirement contributions are some common tax deductible items. Here are some rather unusual ones.
The Internal Revenue Service has been accepting and processing tax returns for the 2023 tax year. The agency allows taxpayers to deduct certain expenses or choose the standard deduction, both of which reduce the amount of their taxable income and, therefore, the amount of taxes payable.
What is the standard deduction?
This deduction refers to a predetermined amount of income that the IRS allows taxpayers to deduct from their taxable income without having to answer any questions about the deduction. The standard deduction amounts for tax year 2023 are as follows:
If appropriate, taxpayers can choose to itemize their deductions. If personal deductions exceed the amount of the standard deduction, the taxpayer could further decrease their taxable income.
A number of filers try to add as many deductible items as possible on their return to bring down the amount they have to pay.
Many are familiar with common tax deductibles such as medical expenses, state and local taxes, mortgage interest, and donations to certain charities or nonprofit organizations. However, there are some unconventional things that the IRS or the Tax Court has allowed or continues to allow as write-offs.
Surprising tax deductions: Deductible items the IRS has allowed
Business expenses
One category where some people get a bit more creative is when they are listing their business expenses. Taxpayers must generally prove that their expenses were necessary or a legitimate business expense, so the IRS does not accept any personal expense. What is surprising is that some of these peculiar costs were accepted as necessary in running the filer’s enterprise.
READ ALSO: The most common mistakes when filing taxes
Breast implants
Although cosmetic surgery is usually a personal expense and is not tax deductible, in 1994, exotic dancer Cynthia Hess won her tax case arguing that her implants were a stage prop and necessary to make a living, according to a report by USA Today.
Private jet use
John and Joanna French won their case to deduct taxes thanks to their private jet. They reasoned that they used it to fly to manage, advertise and rent their condo in Mammoth Lakes, California, from their home in San Jose, California, instead of driving for several hours or relying on a commercial flight.
Body oil
A bodybuilder claimed that body oil was necessary for his profession, and managed to write off the thousands that he spent on both body and tanning oil as a business expense.
READ ALSO: Differences between tax deduction and tax credit
Medical expenses
Another type of expenditure where filers have managed to get a lot of leeway is the medical cost category. The following strange expenses were deemed by the IRS to be necessary for treating the taxpayer’s health condition.
Pets
There are some cases in which deductions related to pet expenses may be allowed. Costs related to service animals may be deductible as medical expenses.
Quitting smoking
One incentive to quit smoking is that you might be able to deduct your efforts on your return. If you have enrolled in a program to stop smoking, bought nicotine patches or other kinds of help to quit this vice, you may qualify for a deduction.
Swimming pools and exercise equipment
Although these items usually cannot be deducted, if a doctor attests that they are used for alleviating or preventing a physical or mental disability or illness, they may be eligible for a deduction.