- You may not know this, but qualifying expenses for an animal "employee" can be taken.
- So can items of value that are donated to charity — like a wedding dress.
- Experts caution that meeting the conditions to claim these unusual deductions isn't always easy.
When it comes to tallying your tax deductions, it can pay to get creative.
The Tax Cuts and Jobs Act took effect this year, and with it, some major changes to the way individuals and businesses file their taxes. Key items include the doubling of the standard deduction to $12,000 for singles and $24,000 for married couples who file jointly, the elimination of personal exemptions and sweeping changes to itemized deductions. The changes do not affect filings for the 2017 tax year.
About 49 million taxpayers, or 28 percent, currently itemize, according to the Urban-Brookings Tax Policy Center. Due to the higher standard deduction, fewer filers are expected to do so in the future.
If you're among them, the list of potential deductions is both wider and weirder than you think. But it's not always easy to qualify, so it's important to consult a tax pro.
"There's certainly no shortage of creativity in the tax-paying public," said Mark Steber, chief tax officer at Jackson Hewitt. "The real [deductions] are pretty fixed. You have to have a unique situation and meet the tax law — or otherwise have additional risks."
Here are a few of the unusual deductions that could cut your tax bill.
The average bride spends $1,509 on a wedding dress, according to a recent survey from The Knot. Don't let that pricey purchase — or other wedding apparel like bridesmaid dresses — gather dust after your wedding.
"You can hang the dress up in your closet and try it on at your 25th wedding anniversary," said Steven Gill, an associate professor of accountancy at San Diego State University. "Or you can make the decision to donate it."
Be sure to get a receipt for that charitable donation. The amount deductible is the resale value, usually around 50 percent of its purchase price, said Shara Abrams, senior vice president of operations at Jackson Hewitt.
That dog might be able to fetch you a deduction — if it's related to your business. Qualified expenses for legitimate working animals "like a junkyard dog or a guard dog" can be deductible as a business expense, Steber said.
"The key to any on these are the facts and circumstances and underlying business relationship that it ties to," he said.
But, he cautions, animal-related deductions have a very narrow window. Costs for your household cat or dog don't apply — the IRS considers those personal expenses.
(Costs related to guide dogs and other service animals may qualify toward a different tax break, the medical expense deduction.)
The deduction for medical and dental expenses may not fly under the radar, but some of these qualifying expenses might.
Experts say swimming pools, a wheelchair-accessible ramp for your house and regular massages are among the things that may be deductible, provided you have a prescription and other support for that purchase as medically necessary.
"The key is that the condition has to be prescribed by a medical physician — not self prescribed," Steber said.
Some states base the fee for registration on the vehicle's value. Itemizing taxpayers in those states can deduct that portion of the registration fee, said tax attorney Megan Gorman, managing partner at Chequers Financial Management in San Francisco.
To qualify, the fee must be assessed annually. Check with your tax professional to find out how much you're allowed to deduct.