Members share most outrageous tax deduction requests
Corey Butler, MNCPA communications manager | April/May 2022 Footnote
Editor's note: Updated March 29, 2022
We here at the MNCPA have found that most — but not all — CPAs have at least one client who comes out swinging every year with a bizarre wish to will something away with the blessing of the tax gods. Alas, they often strike out.
We recently turned to MNCPA members again to ask about their most outrageous tax deductions clients have come calling with. Unsurprisingly, the answers did not disappoint.
While some standouts included wanting to deduct alimony, yoga classes for mental health and a plea to consider the money they used to start a church without IRS designation as a “charitable donation,” many of this year’s 130-plus responses fell into three buckets.
One disclaimer: Like one great tax philosopher (and MNCPA member) often says when asked any question related to tax decisions, “It depends.” While these answers that follow may come with discussions about how they possibly could make it work, respondents to the annual MNCPA Tax Survey, from which these are pulled, thought best not to move ahead with these requests.
Enjoy!
Location, location, location
- One client wanted to deduct a fish house as a portable office in case of an emergency.
- Another opined that their RV was now their office, and therefore should be deducted in whole.
- One member’s client has infrequent meetings in Chicago, so the client wanted to rent an apartment for one year and deduct it.
- A Wisconsin business owner wanted to purchase a cabin in Idaho and write it off as a business expense.
- Another wanted to deduct the cost of his Lake Superior fishing boat because he occasionally took customers fishing.
- One Minnesota snowbird rented a condo in Arizona for a few months, thus making it a second office location.
Leave it to the dogs, cats and — deer?
- When traveling for business, one client wanted to deduct their pet’s lodging.
- At one nonprofit, the executive director wanted to write off the family dog’s grooming because the dog frequented the office.
- The old standby security dog for the trucking business.
- One client wanted to deduct their pet dog as a therapy animal for her clients.
- Passive income doesn’t come easy. One client wanted to write off a housecat they purchased to kill mice at a rental home.
- Simply, “Can I deduct this new deer rifle and ammo?”
It’s not cheap to look good
- A client wanted to take a $65,000 charitable contribution deduction for clothes they donated. The client created a spreadsheet listing out the items and attributed outrageous dollar amounts to the items, such as 20 belts valued at $100 each.
- While not as impressive, another MNCPA member had a client looking for a $20,000 deduction for donating used clothing.
- As for a one-piece donation, one client sought $7,500 for a donated ball gown.
- No punchline here: Adult diapers from CVS.
- Finally, one member had a client request a business expense for Victoria Secret underwear because it made the client more confident as a business owner.
