Your Pet Could Qualify You for a Tax Break
Let’s face it – taxes aren’t fun and, although sometimes helpful, neither are the articles written about them. Now that the pressure of the 2017 tax season has come to an end, we thought we’d share something a little more lighthearted for our animal loving readers.
What Deductions Can You Get From Your Pet?
Do you have an animal that works for you?
Business animals such as dogs and cats could be eligible for deductions. Working animals include guard dogs for a place of business, or a cat that is at the office for rodent control. In order to get these rare deductions, you need to keep a good record of the working animal’s hours. This deduction can help cover a lot of the animals needs like vet bills, food, or even job related training programs. If you take your animal home and it is a family pet, it may be harder to prove that the animal is a business animal, therefore making it difficult to qualify for the deduction.
Do you donate to animal related charities?
As we all know, charitable contributions can be deductible, and this includes pet related charities. If you donate to your local shelter or rescue organization that donation can count towards your normal charitable deductions. It is important to note that adoption fees are NOT considered donations, thus making them ineligible for a charitable deduction. An important recommendation is to get a receipt for all of your donations and maintain records of each. In order for the IRS to accept the deduction, your donation must be paid to a qualified charitable organization.
Do you foster pets for your local shelter?
A lot of shelters have a foster program where you can look after an animal until they are ready to be adopted. There are multiple benefits to fostering an animal. You are helping the animal, your local shelter, and it may even count as a deduction on your taxes. Any unreimbursed expenses you acquire can be deducted. Common unreimbursed expenses can include food, vet bills, or transportation fees to and from the shelter. It is important to note that to qualify for this deduction, the fostering needs to be done through a qualified organization.
Do you have a service animal?
Service animals like Seeing Eye dogs can qualify for deductions. This is noted in IRS publication 502. The deductions can include expenses like the service animal’s training, vet bills, or even the purchase of the service animal. Be mindful that you will need to meet certain thresholds to receive these deductions. This deduction only counts for animals that are certified or trained for a specific condition.
When trying to get a deduction on your taxes from your pet, it is important to remember thorough and proper documentation will be extremely helpful.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. LPL Financial and Walsh & Associates do not provide tax advice. Clients should consult with their personal tax advisors regarding the tax consequences of investing.