While the list of acceptable tax write-offs-and unacceptable write-offs-can be never ending today we’re focusing on two instances that many people might not be aware of. Louisville tax season is fast approaching so if you’re a homeowner who is thinking about demolishing your property to rebuild or if you’re a mother-first time or otherwise-take a look at some important information below.
There’s no tax write-off for letting the fire department burn your house.
When a homeowner chooses to demolish an existing home and rebuild a new home on the same ground it seems logical to let the local firefighters practice their skills in a safe and controlled setting. This not only benefits those wanting their previous residence demolished but it also provides a learning environment for firefighters who keep our communities safe. However to get a tax deduction the homeowner must prove that the value of the donated residence exceeds the value of the demolition services provided which is typically around $10000. In a ruling from Tax Court in 2010 Rolf v. Commissioner 135 T.C. No. 24 (Nov. 4 2010) the Court found proper consideration of the economic effect of the condition that the house be destroyed reduces the fair market value of the gift so much that no net value is ever likely to be available for a deduction.
Nursing mothers and new mothers can write off baby-related expenses.
On a positive note nursing mothers can claim the cost of breast pumps and other lactation supplies as a medical expense. Previously breast pumps were classified as feeding equipment until the American Academy of Pediatrics argued that breastfeeding has numerous medical benefits for both mother and infant and making them more affordable would encourage women to breastfeed longer. Breast pumps and the appropriate accoutrements can exceed several hundred dollars so women without flexible spending accounts can claim them as a tax deduction if their total medical costs exceed 7.5% of adjusted gross income. On a side note many insurance companies offer 100% reimbursement for breast pumps. Call your insurance company to see if some or all of this expense is covered under your policy.
As you begin to prepare for tax season contact Lindemeyer CPA for help in getting the most money out of your tax return.