Category Archives: Taxes

Don’t Try This at Home – Outrageous Attempted Tax Deductions from 2014

It is that time of year again. Maybe it is an attempt to give their members some much needed comic relief, but every year the Minnesota Society of Certified Public Accountants releases a survey of the most outrageous tax deductions attempted to be claimed by clients.

  1. Questionable Dependents – Apparently it is popular to try and claim pets as dependents. One CPA even reported that a woman tried to claim her unborn child.
  2. Daughter’s Wedding – You would be one heck of a great salesperson if you could convince an IRS auditor that the full cost of your daughter’s wedding was business entertainment
  3. Speeding Tickets – Sorry. Not a business expense. Even if you were running late for a business meeting.
  4. Looking a gift horse in the mouth – One CPA’s client learned that they could not claim a vehicle which was impounded by the police as a Charitable Deduction.
  5. Hobbies – The IRS does not allow deductions for hobby expenses as one client learned when he attempted to take deductions for his horse ranch.
  6. Keeping up appearances – the cost of haircuts, plastic surgery, massages, or spa experiences are sadly not deductible.
  7. Creative investments – No one buys real estate with the expectation of losing money. But the loss from the sale of a personal home does not qualify as investment loss.
  8. Home office expenses – Tax code does permit certain home expenses to be considered office expenses, but only the portion of the home dedicated to the business. Sadly, groceries are not included.
  9. Boat – One CPA had to tell a client that his boat was not deductible as a “water computer”.
  10. Hunting trips because you “talk business” – no matter how much you complain about your boss.

Photo: Taxes – Illustration by DonkeyHotey