Dogs, cats, and other household pets are expensive. Owners spend an average of $1,270 to $2,800 to own a dog. The expenses for a family pet that provides you only with love and companionship are never deductible. They are purely personal expenses.
But it is possible to deduct the expenses for a dog, a cat, or another animal if it qualifies as a
· medical expense
· business expense, or
· charitable deduction.
Deducting the Medical Expenses
The costs of buying, training, and maintaining a dog or another animal qualify as deductible medical expenses if you
· use the animal primarily for medical care, and
· would not have paid the expenses but for the disease or illness involved.
You may take medical deductions for service animals trained to aid their owners with a disability. A service animal is any guide dog, signal dog, or other animal individually trained to assist people with disabilities. Service animals are working animals, not pets.
Examples include guide dogs for people who are blind or have low vision, or dogs trained to carry items for people with physical disabilities.
Emotional Support Animals
You can deduct as a medical expense emotional support animals, such as dogs, cats, or other animals that help people suffering from mental or emotional disabilities. Emotional support animals are more challenging to deduct than service animals because they can seem little different from regular pets. A licensed healthcare provider should prescribe or at least recommend the pet as part of a mental health treatment plan. Ideally, you should obtain the animal after a medical professional advises you to get one. If the animal is a dog, it can be any age and any breed. But emotional support animals don’t have to be dogs.
Taking a Medical Expense Deduction
Only about 10 percent of all taxpayers are able to itemize because of the high standard deduction. Additionally, medical expenses are deductible only if, and to the extent, they exceed 7.5 percent of your
adjusted gross income. This rule greatly limits the medical deduction.
If you operate as a business and have a medical reimbursement plan or work for a business that has a medical reimbursement plan, you have an option. You may qualify to deduct 100 percent of your medical pet expenses or have them reimbursed
Business Expenses
You can deduct dogs and other animals as a business expense if they serve a legitimate business purpose. For example, you can deduct security-purpose business-location guard dogs. The guard dog should be trained and should be an appropriate breed for guarding purposes. Examples are a Rottweiler, German shepherd, or Doberman pinscher. Don’t try to deduct a small dog like a Chihuahua as a guard dog!
Cats have achieved business-deductible status when used for pest control at a business location. Pest control is a problem for many types of business. In a Tax Court case, the petitioners, the owners of a junkyard, were allowed to deduct the cost of cat food they left out to attract feral cats. They took care of snakes and rats on the property
Charitable Deduction
If you foster dogs, cats, or other animals in your home, you may be able to take a charitable deduction for the reasonable expenses you pay out of your own pocket, such as pet food expenses and veterinary bills. You may not deduct the value of the time you spend fostering animals or the value of donating space in your home for this purpose.
To qualify for this deduction, you cannot foster animals on your own. You must do so on behalf of a Section 501(c)(3) charitable organization. You must also obtain a written acknowledgment from the charity if your expenses exceed $250