Ten Wackiest Tax Deductions for 2010
Have you heard about the latest crazy tax deductions? How about the cholesterol deduction? The Willie Nelson write-off? The time machine? Or the stripper who bared her assets?
These tax tales are part of the fifth installment of Bankrate's 10 craziest tax deductions. The stories are culled from the overheated minds of the best and funniest certified public accountants across the country, some of whom understandably requested anonymity.
In our first installment, taxpayers tried to write off everything from Spanish cable TV to the cost of hiring an arsonist. Our second installmentuncovered crazy deductions for a pimped-out Amish buggy and a souped-up breast pump.
2008's list of wacky tax deductions included attempts to write off everything from call girls and lavish weddings to the clothes on their backs. Toilet tissue, Jacuzzis and canine contractors topped our list of push-the-envelope business tax deductions in 2009.
What more could possibly send any sane CPA over the edge? Oh, we've got that covered!
Bear in mind that the Internal Revenue Service won't be laughing should you fail to file, falsely file, knowingly underreport or otherwise play fast and loose with your federal income tax return. Do not try these outrageous tactics at home!
You should see his energy drink deduction
Ah, that tempting mileage deduction. Some folks just can't resist padding on a few extra miles in order to stretch their 55-cents-per-business-mile-driven tax write-off.
CPA William Miller of Chanhassen, Minn., has seen some road warriors in his time, but none compare to the client with a serious case of lead foot.
"He was a traveling salesman, so there was some reasonableness to his taking mileage," Miller says. "But the deduction he claimed would have required him to be driving continually all year.
"I did the math and he could have slept for maybe six or seven hours. It was just such an unreasonable number for one person that I didn't think it would fly and I had to let him go.
"To claim those kinds of miles, your name had better be Willie Nelson."
But it wouldn't fit in the shoe box
Accountants are accustomed to receiving client tax receipts in rat's-nest form, stuffed in all manner of shoeboxes, satchels, lunch totes and grocery bags. Bookkeeping can be a messy business after all, and documents frequently get misfiled and misplaced.
But CPA Gail Rosen of Martinsville, N.J., couldn't believe what one client overlooked.
"Last year, I called a client to tell them where they stood on their tax return and all of a sudden heard a baby in the background," she recalls. "I said, 'Did you forget to tell me something?' They did. Thank goodness babies cry!"
You can bet that Gail now has that $3,500 ($3,650 in 2009) child exemption on account.