Are Pets Tax Deductible? 6 Tax Breaks for Pet Owners

Paul Sisolak for GoBankingRates.com writes: Your family of ferrets or school of goldfish might not be tax exempt, but if you’re dead set on getting a tax refund this year, look into some of the options below. Some might sound outside the realm of the animal kingdom — your dog or cat as a business write-off? — but qualify, nonetheless. And it’s easier than getting a set of paw prints to sign that W-2.

1. Moving the family pets

No pet is an island — at least to the taxman. Pets are property like any other household belonging, and can be taxed as such if you’re relocating, since moving costs are sometimes deductible. It might sound strange to lump Rover and Checkers in with your ottoman, sofa and dining room set, but when they’re tax exempt, who’s complaining?

2. Pet food

Is your dog or cat master of its own domain, keeping your property free of pests and unwanted vermin? Then their food comes tax-free.

Kiplinger wrote about the story of a couple who was allowed to write off the cost of cat food used to attract feral felines on their junkyard property. The wild cats reciprocated by hunting snakes and rats on the premises, making the junkyard safer for customers. Though the peculiar case went to tax court, IRS officials agreed in the end that the nomadic ninja cats could eat tax-free.

3. Guard dogs

“BEWARE OF DOG.” He’s tax exempt, with exceptions. Fifi the poodle with a badge won’t fly with the IRS. Entrepreneur Magazine says that the best tax-exempt guard dogs are the ones who look and play the part — pit bulls or German shepherds are naturally intimidating canines with a penchant for making good watchdogs, and thus, can qualify for the tax-free club.

Your dog must also be actually guarding something, like a gated home or valuable property. In this case, it’s the dog’s services, not the dog itself, being deducted.

4. Animal adoption fees

It’s generally believed that donations made to nonprofits such as churches and other charities are tax deductible. This is true, to an extent. Fees paid, or donations made, to animal shelters are not deductible — rescue organizations need initial funding to pay for operational costs like feeding the animals in their care.

Added donations, however, are technically tax-free. If you’re interested in adopting a pet in need of a loving home, this is a good way to welcome a new family member and make a tax deductible gift in one.

5. Service animals

Seeing-eye dogs and others with special training are tax exempt as per the IRS. This doesn’t mean that training your dog to fetch snacks for you while you veg out on the couch means living tax-free. By law, service dogs are licensed by their owners with special documentation and neck tags from a doctor.

6. Leader of the pack

Being a professional dog is hard work that deserves a tax break. If your pet also works in show business — think pageant presenters or agility trainers — they might be tax deductible. Experts emphasize that if your dog is a well-trained Lassie, it must be documented, business-related and a reasonable expense.

Remember, the 2014 IRS tax deadline is Tuesday, April 15, so there’s plenty of time to configure your pets into your filing schedule. You might find your relationship is full of love, and free of taxes.