Service dogs, the canines that lead the blind and provide emotional support, have been gaining in popularity. They are helpful in many contexts and enjoy special status under the Americans with Disabilities Act. They also have special status under IRS rules because their medical expenses and the cost of their food and training can be deductible as a medical expense. No deductions are allowed for ordinary dogs.
Here is what IRS Publication 502, Medical and Dental Expenses has to say about it: "You can include in medical expenses the costs of buying, training, and maintaining a guide dog or other service animal to assist a visually impaired or hearing disabled person, or a person with other physical disabilities. In general, this includes any costs, such as food, grooming, and veterinary care, incurred in maintaining the health and vitality of the service animal so that it may perform its duties".
The medical expense deduction in my experience is mostly an illusion because only the amount of medical expenses in excess of 10% of a taxpayer's income is deductible. Furthermore, taxpayers who do not itemize deductions are unable to benefit from medical deductions. Nevertheless, I predict that service dogs are going to continue to grow in popularity and that lots of dog owners are going to want to pass Fido off as a service animal in order to get a tax deduction.
- Mark S Gleason CPA
www.lakes-cpa.com
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