The 9 weirdest tax write-offs

By Bankrate.com

Have you heard the one about the doggy-day-care deduction? The male model? The pimped-out Amish buggy?

That's right -- Bankrate's back with another nine of the craziest tax write-offs you've ever heard of, in the hope it will make paying your 2007 federal income tax a little bit easier.

For our previous installment of the nine weirdest write-offs, we combed the country collecting stories from certified public accountants about the craziest tax deductions they'd ever seen. The search turned up plenty of ingenious ways in which taxpayers have tried to justify deducting everything from ostrich breeding and dog food to sperm donations.

Dogs once again get their due in this year's collection. Though our pets may seem like part of the family, as we will see, attempts to treat them as actual dependents -- or more outrageously, subcontractors -- simply won't fly with the Internal Revenue Service.

It's never a good idea to tempt fate by trying to slide one by Uncle Sam. Serious consequences may result from underreporting income, filing a false or erroneous claim, or attempting to make up your own personal tax rules.

Deductions in the tax code tend to fall into two broad categories, according to John Barghini, a CPA and partner in Hansen, Jergenson, Nergaard & Co. of Minneapolis.

"Deductions are primarily related to business activities or where our government wants to reward us for being family people, as in dependent and day-care deductions," he says.

Though it may seem like deductions would be easy to abuse, Barghini says most taxpayers don't consider the reward worth the risk.

"I think there is more unreported income than there are overstated deductions," he says. "The deductions where people tend to fudge it are in charitable contributions. And some you can't fudge, because things like mortgage interest or real estate taxes are typically reported to the IRS."

Ah, but that doesn't mean we don't try.

1. Hidden asset

Elizabeth Dittrick of Dittrick & Associates in Cleveland was a staff accountant with Arthur Andersen when she witnessed a particularly uncomfortable client meeting with a married couple. The deduction was legitimate; it was the underlying asset that proved to be the problem.

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"We were going over their tax information, and the tax manager asked the gentleman, 'Now what about the mortgage interest deduction for the condo in Utah?' Unfortunately, the wife didn't know about the condo in Utah, where he had set up his mistress. It was a big 'oops' moment. There was this stony silence in the room. It was absolutely awful," she recalls.

2. Dog-ductions, part 1

What dog lover hasn't melted when man's best friend gives him that baleful look as he heads off to work? One taxpayer decided to create his own tax rule to ease the pain: "There is one individual who tried to deduct a day-care expense for their dog," Barghini says.

"The person was working, and they didn't feel that the dog should be left alone, so they hired somebody to watch the dog, then tried to take a day-care tax credit for the doggy-sitting. The dog clearly was an economic dependent, but not for tax purposes."

3. Now THAT'S a super!

Sure, it's easy to find bad things to say about landlords, but what about all the good things they do? Dittrick admits that while she liked the sentiment, she wasn't buying this landlord's story for a minute:

"There was a guy who had rental property and tried to deduct a limousine charge in the year he got married by claiming that he had taken his renters out for a night on the town, when I knew that it was for the wedding," she says. "I ended up refusing to sign the return."

4. At that price, it should change diapers, too

CPA Ruth Ann Michnay of St. Paul, Minn., thought she might have been out of touch with maternity technology on this one: "I once had a young mother as a client who listed a breast pump at over $300," she says. "My kids are grown up, but I never remember them being that expensive, so my first reaction was that it must have been some medical situation with the child. You never know.

"But no, it was strictly for her convenience to operate. She was claiming it as a medical expense. I talked her out of it." The priciest motorized pumps can cost more than $300, but many hand-powered pumps are less than $50.

5. Dog-ductions, part 2

You think it's hard to find good help? Tell it to the IRS. Even the CPA source for this one wished to remain anonymous:

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