- Grabbing itemized deductions is harder now that the standard deduction is so high: During the 2019 tax year, it was $12,200 for single filers and $24,400 for married-filing jointly.
- Claiming an aggressive deduction? Prepare to back it up when you file your taxes.
- Off-the-wall tax breaks that have been fought for and won in Tax Court include deductions for body oil and payments to a live-in girlfriend.
There's aggressive tax planning — and then there's claiming tax breaks for bodybuilding oils and landscaping.
The 2018 tax overhaul has made it harder for filers to claim itemized deductions. The legislation also eliminated a grab-bag of obscure tax breaks, known as miscellaneous itemized deductions.
Still, some of the most ambitious taxpayers will go to the mat against Uncle Sam to save a few dollars.
"The burden you face depends on the issue of facts versus law," said Ed Zollars, CPA with Thomas, Zollars & Lynch in Phoenix.
"Is this aggressive because you don't have the records to back it up, or is it aggressive because you can say 'You can read the law this way and maybe it works?'" he asked.
Here are five unusual tax breaks that filers have claimed.
Back in 1978, Douglas E. Bruce, then of Pacific Palisades, California, owned rental properties in the Los Angeles metropolitan area.
His girlfriend, Elissa Elliot, moved in with him and managed the rentals, including overseeing renovations and home improvements at the properties.
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When calculating his net rental income to file his taxes, Bruce claimed a $9,000 deduction, stating it was compensation paid to his girlfriend.
In 1983, the Tax Court blocked the full amount of the write-off but permitted Bruce to claim $2,500 in "ordinary and necessary expenses" incurred with the management and maintenance of the properties.
Corey Wheir, a boilermaker in Wisconsin Rapids, Wisconsin, allegedly came up short on federal income taxes in 1999, 2000 and 2001.
During those three years, Wheir tried to claim a deduction for his bodybuilding expenses, which included supplements — such as his "3-pounds a day" buffalo meat habit — and an array of oils and products he used to beef up his appearance at competition.
The Tax Court wouldn't allow the buffalo meat write-off, but the oils that made Wheir shiny and tan were permitted.
"As to these products, while there may be some doubt, the Court concludes, on balance, that the scale tips ever so slightly in favor of the petitioner," the Tax Court said.
Hawaiians may be eligible for an "exceptional tree" tax deduction on their state returns, writing off up to $3,000 in maintenance costs per tree once in a three-year period.
Your potted ficus won't qualify. Trees must meet a range of criteria, including cultural or historic value, age, rarity and location.
Colorado, Delaware, Maryland and New York are among the states that offer tax breaks for homeowners who reside in and maintain historic dwellings. Be aware that your home must meet certain requirements in order to qualify.
For instance, it needs to be registered in the state or national register of historic places, or it must be located in a qualifying historical district.
Be aware that renovations to these properties must also preserve the home's historically significant features.
Business deductions are where things tend to get tricky with taxpayers.
"It really boils down to having the receipts to note your expenses, and you need to prove that the expense is necessary," said Lisa Greene-Lewis, CPA and tax expert with TurboTax.
In 2001, Henry J. and Patricia Langer, a Minnesota couple, claimed a range of home business deductions, according to a 2008 Tax Court opinion.
Back then, Patricia taught piano at the couple's residence, while Henry, a former IRS agent, also ran a financial investigation practice out of their house.
The two tried deducting a slew of expenses, including swimming pool supplies, landscaping, a Nativity set and an SUV, the court found.
The court blocked most of these tax breaks, but permitted the couple to nab a partial write-off for an outdoor lighting system, plus mortgage interest related to business use of the home.
"Petitioners claimed as business expense deductions many obviously personal items," the Tax Court said. "A former Internal Revenue Service agent should have known better."