I love my dog, Althea, and she lives a good life with a large fenced-in yard to roam and heated floors in our home. We live near a trail system where she can generally hike off-leash and I spare no expense on her dog food and treats. She has regular visits to the vet and as a bordoodle (border collie / poodle mix) she requires grooming every 6-8 weeks. At this point, Althea gets her hair done more frequently than I do. These expenses add up, but not one will give me a break in my taxes because although Althea is a family member she is also a pet.  There are no tax deductions or credits that can be taken for a pet.

However, if Althea became a service dog or a dog actor/model where she produced an income her expenses could be deductible. To note here, emotional support animals do not qualify as a service dog unless they meet the strict service dog criteria. The expenses for guard dogs for business property may be deductible business expenses. I don’t think I could convince anyone that my loveable and friendly bordoodle provides security to my business. Although she barks at the neighbors who walk by, it is more of a greeting than a warning and her tail is wagging as she barks. She is a sweet dog who leans into you to get affection. She is not scaring off anyone…

Apart from pets, there are many things that will give you a break on your taxes.  These fall into two classes – deductions and credits. 

Tax deductions reduce your taxable income. The Tax Cuts and Jobs Act (TCJA) significantly increased the standard deduction for all filing statuses. As a result, many taxpayers no longer benefit from itemizing deductions.  When preparing taxes there is normally a comparison between the standard deduction and itemized deductions and the larger deduction amount is taken.  Things that can be deducted when you itemize include:

• Medical and Dental Expenses
• Taxes You Paid
• Interest You Paid
• Gifts to Charity
• Casualty and Theft Losses

Medical and dental expenses include all expenses where you were not reimbursed, or the expense was not paid by someone else. So, if you had medical expenses that were paid by your health insurance you cannot include in this category.  However, if you had a co-pay with your health insurance, those expenses could be included in this category.  The key to this category of itemized deductions is that only the medical and dental expenses that are greater than 7.5% of your adjusted gross income can be deducted. For example, if your adjusted gross income was $80,000 then medical expenses greater than $6,000 could be deducted.

In the Taxes You Paid section of itemized deductions the main category is state and local taxes, also abbreviated to SALT. Your state and local income tax or general sales tax can be deducted here. Only one can be deducted but not both. Also included are state and local real estate taxes and personal property taxes. Real estate taxes are also called property taxes and are the taxes you pay on homes, land, and buildings. Personal property tax usually applies to vehicles such as cars, boats, and recreational vehicles.

In the Interest You Paid section the main category tends to be your home mortgage interest and points. The amount is larger for those with higher interest rates on their home mortgage and it is reported on your 1098 mortgage interest form that you’ll receive from your mortgage lender. You can also deduct home mortgage interest not reported on the 1098 mortgage interest form, such as if you paid interest to the person from whom you bought the home.

Gifts the Charity and Casualty and Theft Losses are smaller categories.  Gifts and charity need to be tracked so keep those receipts when you donate to thrift stores or make cash contributions. Casualty and Theft Losses are limited to those in a federally declared disaster.

Tax credits directly reduce the tax you owe dollar for dollar. The most common tax credits include:

• Child Tax Credit
• Child and Dependent Care Credit
• Earned Income Tax Credit
• Educational Credits
  • American Opportunity Credit
  • Lifetime Learning Credit
• Energy-efficient home credits

Tax credits are generally tied to specific life situations, qualifications, or expenses you incur, rather than simply reducing income like deductions.

There is no general tax deduction for pets, but many situations can reduce your overall tax burden. If you have an unusual expense, it’s always worth asking whether it may qualify for a deduction or credit. Tax laws change frequently, so staying informed or seeking guidance is important.