As CPAs, we help a lot of clients with tax preparation, bookkeeping, and financial reporting. We are truly thankful for all clients, even when they try to claim some “interesting” deductions from time to time.
While we decompress from tax season, we thought this would be a fun article topic. From CPAs all over the internet, here are some of the most outrageous business and personal deductions people have tried to claim!
Evidently, trying to write off a wedding as a business expense is a popular tactic. Multiple sources have reported clients who pay for their – or their child’s – wedding, invite some clients, and try to write it off as a business entertainment expense. The IRS does not count weddings as legitimate business entertainment.
Denied: Hiring an arsonist
According to TurboTax, a business owner whose business was struggling hired an arsonist to burn the building down. The owner then attempted to deduct as a business expense the $10,000 fee paid to the arsonist. In addition to linking himself directly to a criminal act, it turns out that he didn’t even have the arsonist’s 1099 on file.
Approved: Breast implants
Just because it sounds outrageous doesn’t mean it gets denied. Such is the case with exotic dancer Chesty Love. Forbes says she purchased breast implants to give her a 56-FF bust. The IRS initially denied her claim that the surgery was a business expense. The Tax Court, however, allowed it, saying that the implants were a type of stage prop and could be deducted as depreciable assets.
Denied: Nuclear Fallout shelter
The Fiscal Times reports that in 1960, a taxpayer in Worcester, Mass., deducted $9,355.75 for the construction of a nuclear fallout shelter outside his home. The man was afraid of what would happen in the event of a nuclear war. He claimed the shelter as a medical expense, noting that his doctor said it would reduce anxiety. The claim was denied.
Denied: Dance lessons
In the 1959 case of Irving A. Adler, Petitioner, v. Commissioner of Internal Revenue, Adler claimed his $593 dancing lessons as a medical expense to improve his varicose veins. He heard it would help during a lecture while in the Army, not based on a doctor’s recommendation. The Tax Court ruled it as nondeductible.
Legitimate deductions can save you money
Whether you are an individual or business taxpayer, deductions can go a long way toward reducing your tax responsibility. There are so many legitimate deductions that it can be difficult to keep up with, so please ask us! Your experienced, knowledgeable CPAs are here to help!