6 Weird Things the IRS Says You Can’t Write Off – Yahoo Finance
With about 70 days to go until tax day on April 18, many Americans will be looking for imaginative ways to avoid forking over money to the IRS. While some taxpayers undoubtedly straddle the line between valid and “creative” deductions on their tax returns, sometimes you just have to shake your head in amazement at what people will try to write off.
The Future of Finances: Gen Z & How They Relate to Money
Experts: Here’s How Much You Should Have in Your Checking Account
Here are six expenses you shouldn’t try to deduct on your taxes in 2023:
As most landlords and rental property owners know, general repair material and labor costs are deductible expenses. But repairs that enhance the quality of your property, like carpet removals, are improvements, according to IRS publication 527. There are specific ways to claim repairs and improvements on your taxes, but you definitely can’t claim the removal of carpets as a medical tax deduction.
As the Fiscal Times describes, in 1993, a California woman who just happened to have started a home-based interior design company deducted $14,098 for the removal of carpet from her house — plus the the cost of installing of red oak hardwood floors and repainting of her house — as a medical expense. A U.S. Tax Court rejected a 13-year-old recommendation from her doctor that removing her carpets would help with her dust allergies.
The IRS permits taxpayers to deduct dental expenses — including dentures — that exceed 7.5% of your adjusted gross income, thus reducing your taxable earnings. However, these are deemed personal expenses, not business ones.
In 1935, character actor Ned Sparks, deducted the cost of two sets of upper dentures as an ordinary and necessary business expense on his tax return. Claiming the false teeth helped his articulation and removed a hiss from his speech while acting, Sparks could not prove that the dentures were for business use only and not for personal use. Per Casetext and the Fiscal Times, the U.S. Tax Court and the Board of Tax Appeals agreed that Sparks didn’t have a leg (or tooth) to stand on, with the Board declaring, “It would be difficult to imagine anything more personal than a set of false teeth.”
If required in a professional capacity, lessons are considered “ordinary and necessary” deductions for dancers by IRS definitions. Maintaining and improving job skills is integral to one’s job as a dancer or instructor. And claiming an American opportunity or lifetime learning credit for dance classes that are part of your college program’s tuition is acceptable. But for health reasons? Not so much.
Taxpayers have attempted to claim dancing lessons as medical expenses to treat everything from anxiety and depression to arthritis and varicose veins, but those efforts have been in vain. So, if your doctor recommends Zumba classes for whatever ails you, it’s a healthy suggestion, but not a financially sound one.
Despite detractors’ best efforts, mink coats are still popular in some social circles as symbols of luxury and affluence. You can make a tax-deductible donation of your old precious fur to PETA, but deducting a new fur purchase for social schmoozing is a networking no-no.
One-fifth of the cost of a $2,500 mink coat bought for the purpose of mingling with associates at a National Distillers Company function was claimed as a deduction on a New York couple’s tax return in 1947. Per Leagle, because “the garment was admittedly worn on social occasions unconnected with business and such personal expenses are denied deduction by section 24, Internal Revenue Code of 1939,” the claim was denied by the United States Tax Court. If company employees wore mink coats as uniforms on the job only, this couple might have had a good case.
Individuals suffering from diabetes often have a difficult time managing a restrictive diet given the overabundance of sugary and carb-heavy foods that crowd today’s grocery shelves. Unfortunately, diabetics are not given special treatment when it comes to claiming healthy foods on their taxes like they are with expenses related to monitoring and treating their disorder.
When an Illinois taxpayer with diabetes tried to deduct grocery expenses of $461.38 as part of his medically prescribed diet, the Tax Court intervened. In its ruling, the U.S. Tax Court denied the deduction, saying these were “substitutes for foods normally consumed by a person, and as such, their cost constituted a nondeductible personal expense,” according to the docket supplied by Leagle.
Turning around a failing business can be a Herculean task. While some owners simply accept the pitfalls that come with running their own company as they try to better their lot, others resort to less legitimate means to rid themselves of a corporate burden.
Take Our Poll: How Much of a Tax Refund Do You Expect in 2023?
Read: Get a Jump on Your Taxes With These Tips From the IRS for 2023
Burning down one’s own business for insurance money is a common crime story trope, but a real-life taxpayer who hired an arsonist to do the dirty deed actually had the audacity to claim a deduction on his taxes. Besides pocketing $500,000 in insurance money, CBS MarketWatch.com noted that the Pittsburgh, Pennsylvania furniture store owner deducted $10,000 paid to the arsonist as a “consulting fee.” Needless to say, the IRS took exception to this deduction.
More From GOBankingRates
Dollar Tree: 5 High-Quality Items To Buy Now
Do You Have a Tax Question? Ask a Tax Pro
The 10 Best Cash Back Credit Cards for 2023
6 Reasons Why You Shouldn’t Procrastinate on Your Taxes
This article originally appeared on GOBankingRates.com: 6 Weird Things the IRS Says You Can’t Write Off
Although more than 70 million Americans were receiving Social Security benefits as of Nov. 2022, qualification isn't automatic. If you want to claim retirement benefits, not only will you have to be…
President Joe Biden delivered his second State of the Union on Tuesday, Feb. 7 covering a range of topics including issues at home, such as inflation and the debt ceiling, to global ones, such as the…
The IRS has told people who received a tax rebate in South Carolina and other states last year to hold off on filing their taxes. Here’s what to know.
There are more business travel tax deductions available to workers than you might realize. As a general rule, most costs associated with business travel — such as transportation, lodging and meals –…
Debt is a growing problem in America. Total household debt was over $16.51 trillion in the third quarter of 2022, according to the Federal Reserve Bank of New York. Check Out: How Much Americans Have…
The spin-off series is coming soon.
If you want to retire comfortably, then you need to start planning now. By understanding how to maximize your Social Security benefits, you won't have to worry.
When buying in bulk, Sam's Club and Costco both offer great deals. However, you might be surprised to learn that some items and overall product categories are cheaper at Sam's Club. See: 10 Best New…
D.C. Councilmember Charles Allen re-introduced legislation on Tuesday that would help D.C. residents switch to electric or induction stoves. FOX 5's Tisha Lewis gets reaction to the bill in Northwest.
The actress starred in season two of the hit Netflix show.
With inflation that's taking a long time to cool down (and which is continuing to affect food prices), it's no surprise consumers are heading to discount stores for groceries. The latest (Jan. 2023)…
The Pacific Rim is home to most of the strongest quakes in history. Many of them have also created devastating tsunamis.
The expanded Child Tax Credit approved during the COVID-19 pandemic lifted nearly 3 million U.S. children out of poverty in 2021, according to U.S. Census Bureau data. When the program ended last…
You can still get these Cyber Monday 2022 sale items from Our Place, All Birds, Amazon and more. The best part? They're all under $100.
STORY: Pentagon spokesman Brig. Gen. Patrick Ryder said the United States was aware of the four past flights before it detected the latest Chinese balloon prior to its arrival over Alaska on Jan. 28.A U.S. military fighter jet shot down that balloon on Saturday off the South Carolina coast, triggering condemnation from China, which said it was a civilian air vessel.
Of the 66 million Americans who receive a Social Security check every month, according to the Social Security Administration, one couple claiming benefits may come as a surprise: President Joe Biden…
While oil and its refined derivatives are still the mainstay of our energy economy, their prices are rising – in fact, high prices for gasoline and diesel are major drivers of the current high rates of inflation, and are partly responsible for the strong push to promote electric vehicles (EVs). But switching to EVs doesn’t end our reliance on energy. It will just make us trade one issue – reliance on oil – for another – reliance on lithium batteries. In this case, as Elon Musk has said, “Lithium
Shares of Lumen Technologies (NYSE: LUMN), a cloud connectivity and security solutions company, were plunging Wednesday after it reported its fourth-quarter results. The company actually beat Wall Street's consensus estimates for the quarter, but investors focused their attention on management's disappointing guidance. Lumen's non-GAAP earnings per share were down 15% from the year-ago quarter to $0.43, but that easily outpaced analysts' average estimate of $0.19 for the quarter.
Time flies. But it also crashes.
Shares of Google parent Alphabet are down in Wall Street trading after a glitch in the company’s new artificial intelligence (AI) platform, Bard, contributed inaccurate information in promotional video.
