I used to make a joke with my clients who came in during tax season to try and break up the monotony. I would ask for their children’s Social Security numbers, and then I would ask, “Do you have any dogs or cats with Social Security numbers?” (Pause for effect). That used to get a laugh and loosen the client up a bit.
As it turns out, you actually may be able to deduct your pet on your tax return.
On my birthday in May, with the help of my son, Brenden, my search for a dog ended with a trip to the county animal shelter. We adopted a half German shepherd, half Labrador retriever that we named Arrieta (after Chicago Cubs pitcher Jake Arrieta).
My dog is a rescue dog, and let me tell you a few of my theories as to why. She has taken off four different times from our house, so far. She has a collar with her name and phone number on it, as well as a chip in her neck, so it isn’t like she would be lost forever. Or, could it be that she was taken to the shelter because she is only quasi-house trained? Maybe because of her insatiable barking and howling that commences every time you put her outside at night? It could also be because she likes to bite you when you play with her.
There are so many reasons why she was at the county animal shelter that you could just spin a wheel and take your pick.
Anyway, for Christmas we went to Chicago, and my wife managed to bring her three-pound Chihuahua on the plane for free, in her lap no less, by having her doctor sign a form for the airline stating that the dog was her emotional support dog. It was either that or we would have to pay $500 for the dog to fly with us. I would just as soon put the dog outside and give it a heaping bowl of food and some water and hope for the best, but my wife was adamant about taking her with us.
It got me thinking: If my wife could so easily get her dog on the plane, then why couldn’t I get Arrieta certified as an emotional support dog and take her everywhere with me?
There are several “certification” sites that will “certify” your pup as an emotional support dog. According to the Americans with Disabilities Act (ADA), every business would have to accept the certification, right? Wrong. The ADA allows for service animals, but not emotional support animals. So, businesses don’t have to accept emotional support dogs like they do service dogs.
However, could I deduct my emotional support dog’s expenses on my tax return? The answer may shock you – maybe. Service dogs for the blind and the deaf are obviously deductible. However, the cost of a dog that is trained to treat an individual’s physical or mental illness, and is used primarily for that purpose, is considered a medical-care expense. Bingo! I found a loophole. All I have to do is get my dog certified and I can deduct her expenses. Easy peazy. But as Lee Corso often says on College GameDay, “Not so fast.”
If I can train Arrieta to be an emotional support dog and get a doctor to certify that I need the dog, then she is deductible. That is exactly right. However, getting a dog trained and then certified can cost several thousands of dollars and a lot of time. I’d have to enter the program for about a year, and the cost could run me upwards of $10,000 or more.
You might be saying to yourself “but that amount is tax deductible,” and you would be sort of right. Let’s remember the medical expenses rule. The cost has to be in excess of 10 percent of adjusted gross income (AGI). For example, if your AGI is $100,000, then anything more than $10,000 is deductible. Like I tell my clients, let’s not actually spend ourselves into a tax deduction. What that means is, don’t spend money and buy stuff you don’t need just to deduct it on your return.
In summary, a dog can be tax deductible, but don’t advise your client to go out and get his or her dog certified just to be able to deduct it.
Now if I could just find a way to be able to deduct the lights that my kids leave on, and all the food that they eat, I would be happy.
About Craig W. Smalley, EA
Craig W. Smalley, MST, EA, has been in practice since 1994. He has been admitted to practice before the IRS as an enrolled agent and has a master's in taxation. He is well-versed in US tax law and US Tax Court cases. He specializes in taxation, entity structuring and restructuring, corporations, partnerships, and individual taxation, as well as representation before the IRS regarding negotiations, audits, and appeals. In his many years of practice, he has been exposed to a variety of businesses and has an excellent knowledge of most industries. He is the CEO and co-founder of CWSEAPA PLLC and Tax Crisis Center LLC; both business have locations in Florida, Delaware, and Nevada. Craig is the current Google small business accounting advisor for the Google Small Business Community. He is a contributor to AccountingWEB and Accounting Today, and has had 12 books published on various topics in taxation. His articles have also been featured in the Chicago Tribune, New York Times, Yahoo Finance, Nasdaq, and several other newspapers, periodicals, and magazines. He has been interviewed and been a featured guest on many radio shows and podcasts. Finally, he is the co-host of Tax Avoidance is Legal, which is a nationally broadcast weekly Internet radio show.