We love them, play with them, groom them, and go to great lengths to care for them. And who can blame us? They’re members of our family. We want the best for them and we indulge them with new toys, fancy food, or plush beds whenever our budget allows it. And when the worst happens and our dog gets ill and needs extensive veterinary care, we find a way to scrape up the money to make our best friend better.
So when tax season rolls around, many pet parents might be thinking how their dogs might be considered as dependents or legitimate tax deductions.
Caring for our furry friends isn’t cheap. Collectively, pet parents in the U.S. spent $53 billion last year, according to the American Pet Products Association. The individual cost of raising a dog ranges from $1,314 annually for smaller breeds to $1,843 a year for big dogs, according to the ASPCA. This figure includes dog food, pet insurance coverage, basic preventative veterinary care, and grooming costs.
A few years ago, there was a movement to relieve some of burden of pet care costs. A bill was introduced to Congress, H.R. 3501, called the “Humanity and Pets Partnered through the Years” (or, HAPPY). Michigan Rep. Thaddeus McCotter introduced the bill, along with Rep. Steve Cohen of Tennessee and Rep. Jared Polis of Colorado, in the hopes of reducing pet parents’ financial burdens by allowing a $3,500 tax deduction per year. Although the bill was endorsed by many organizations (including the ASPCA, the Humane Society of the United States, the Animal Law Coalition, the American Veterinary Medical Association, and the Pet Industry Joint Advisory Council), it failed to garner enough votes to pass.
So if Uncle Sam isn’t going to give pet parents a break, is there anything else that can be done? Well, maybe. Lisa Greene-Lewis, lead CPA at the American Tax and Financial Center at TurboTax, says there are some legitimate tax deductions for pet parents, but only in specific instances. She cautions taxpayers to tread carefully when making these deductions by having receipts and documentation to back up these claims, should the IRS decide to audit your return.
Here are six instances where you could make a deduction:
1. Service dogs
If you or your dependent receives assistance from a service dog such as a seeing-eye dog, you can deduct the cost of buying, training, and caring for the dog. Such dogs are considered medical expense deductions.
2. Guard dogs
If Fido guards your place of business, you would be able to write off expenses for care and feeding. However, Uncle Sam is not going to approve of a deduction for a Chihuahua or Pekingese, not matter how fierce they act. Your deduction is less likely to raise an auditor’s eyebrow if your dog is a traditional guard breed such as a Rottweiler, German Shepherd, or Doberman Pinscher.
Dog breeders can claim the care and feeding expenses for their dogs and puppies as a business deduction, as long as breeding is their career and not a hobby, says Greene-Lewis. If you have a space on your property dedicated exclusively to breeding, it is also a viable business deduction.
4. Pet actors
Taxpayers who are lucky enough to have a pet in show business can deduct some of the expenses directly related to the business, as long as the expenses are reasonable. And no, we’re not talking about that cute video of Bowser chasing his tail that you uploaded to YouTube last week.
Good news! Not only can you save a dog’s life, but you can deduct the cost of the donation for adopting the dog. These adoption fees typically cover shots and the cost of a spay or neuter surgery.
6. Foster care
If you directly foster a dog for an animal shelter or rescue organization, you can deduct expenses such as vet bills, boarding, food, collars, leashes, medication, and toys. If you’ve been on the fence about whether to foster dogs, perhaps this news will tip fostering in your favor.
Hopefully, these tax tips will provide some guidance on what pet-related tax deductions are legal in the eyes of Uncle Sam. If you have any further questions, it’s best to consult an enrolled agent or CPA to get expert advice.
And if you’d like to see your fur kid eligible as a tax deduction in the future, contact your Congressional representative!
Editor’s note: A previous version of this story stated that guide dogs, rather than service dogs in general, can be considered for tax deductions.