Jo Willetts, EA
Director, Tax Resources
Published on: February 20, 2020
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A recent survey by the American Pet Products Association has revealed that owners of pets in the United States spent over $75 billion on their animals in 2019, a significant portion of which was related to food, followed by veterinarian costs. While it may not be possible to put a value on the importance of having a pet in your life, there are definitely ways to recover the costs of their maintenance to some extent.
Like most pet owners, it is likely that you consider your pet as an integral part of your family; in fact, your pet might be just as important to you as a child. Unfortunately, the IRS does not think along the same lines. In most cases, pet-related costs are considered personal expenses, and you cannot claim pets as dependents. The new tax law makes it harder to differentiate between your kids and your pets at tax-filing time by suspending your and your children’s exemption amount from this year on.
But there are some tax deductions that you can claim for your dog or other pet and associated expenses. The following are some tax breaks provided by the IRS that you might be able to take advantage of if you have a pet.
While you cannot claim pet medical costs for your pet, the costs associated with service animals – such as guide dogs for hearing or visual impairments, and certified service dogs for certain other health conditions, such as seizure dogs for those with epilepsy – may be deductible.
Only the portion of your medical expenses that exceed 7.5% of your Adjusted Gross Income (AGI) is considered part of your itemized deduction. Also, the total of all itemized deductions must be greater than the standard deduction, which is much higher due to tax reform.
Fostering a pet for a qualified nonprofit organization doesn’t come cheap. So being able to claim any expenses incurred as a result will provide you some financial relief on an annual basis. Expenses that can be listed under Schedule A as charitable deductions are:
Any charitable donations that you make in cash or kind to such ventures are also tax-deductible if you itemize deductions. Don’t forget to keep a mileage log and receipts for these expenses. Tax reform has increased the allowed deductions for these types of donations to 60% of your AGI.
If you can establish that you have an animal that is providing some type of service for your business and you are self-employed, you will be able to write off expenses related to the animal, such as food, special training, and veterinary care, as business expenses.
Employee business deductions are no longer allowed under tax reform.
When your pet generates income for you, you may be able to deduct some or all of your expenses.
Be sure to keep track of all pet expenses and retain receipts diligently so that you can maximize your claims. Any pet-related expenses that are not covered under the above criteria don’t usually qualify as deductions.
About the Author
Jo Willetts, Director of Tax Resources at Jackson Hewitt, has more than 25 years of experience in the tax industry. As an Enrolled Agent, Jo has attained the highest level of certification for a tax professional. She began her career at Jackson Hewitt as a Tax Pro, working her way up to General Manager of a franchise store. In her current role, Jo provides expert knowledge company-wide to ensure that tax information distributed through all Jackson Hewitt channels is current and accurate.
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