Top 10 most outrageous tax deductions of 2014
February 11, 2015 12:05 PM
Overview:
Between client lunches and traveling to employer sites, benefit advisers can incur some interesting and often tax deductible expenses. But not everything is tax deductible. Here are the top 10 most outrageous tax deductions of 2014, according to the Minnesota Society of Certified Public Accountants. In a survey of its CPA members in public accounting, MNCPA found deductions included everything from pets and weddings to cars impounded by the police.
[Image: Fotolia]
[Image: Fotolia]
1. Questionable dependents
Attempting to claim "Fido" as a dependent is popular amongst clients with pets. And one CPA reported a woman tried to claim her unborn child as a dependent.
[Image: Fotolia]
[Image: Fotolia]
2. A daughter's wedding
Sure, weddings are entertaining. But deducting the full cost as an entertainment expense does not make for a good relationship with the IRS.
[Image: Fotolia]
[Image: Fotolia]
3. The cost of speeding tickets
Even if it's because you were late for a business meeting, speeding tickets are fines and therefore, not deductible on your tax return.
[Image: Fotolia]
[Image: Fotolia]
4. Misinterpretations of charitable donation
Charity can take on many forms. But for one CPA's client, a vehicle that was impounded by the police was not deemed a qualifying deduction.
[Image: Fotolia]
[Image: Fotolia]
5. Hobbies
The IRS does not allow deductions for hobby expenses. One client learned that when he attempted to take deductions on his horse ranch.
[Image: Fotolia]
[Image: Fotolia]
6. Keeping up appearances
While some professions may require a certain appearance, the cost of haircuts, plastic surgery, massages and salon expenses are generally not deductible.
[Image: Fotolia]
[Image: Fotolia]
7. Creative investments
The loss on the sale of a personal house, while unfortunate, does not qualify as an investment by the IRS.
[Image: Fotolia]
[Image: Fotolia]
8. Expansive home office expenses
Deductions on a home office are limited to the portion of the home dedicated to the business. Clients have attempted to do more though, from the cost of groceries to the mortgage.
[Image: Fotolia]
[Image: Fotolia]
9. Boats
Want smooth sailing on your tax return? Then you should not deduct your boat as a "water computer," as one CPA had to inform their client.
[Image: Fotolia]
[Image: Fotolia]
10. Hunting trips because you "talk business"
That weekend of hunting with friends is generally not deductible, no matter how often you talk about your boss.
[Image: Fotolia]
[Image: Fotolia]
