March 06th, 2016

TAX TIP OF THE DAY... 

Strange Deductions, Exemptions, and Tax Breaks from the U.S. and around the World

• In Texas, cowboy boots are exempt from the sales tax, but hiking boots are not.
• In Ohio, a corpse in a mortuary gets makeup applied on it without getting taxed, but a living person is taxed for the makeup that gets applied in a beauty salon.
• In South Carolina, one can get a $50 deduction if they donate a dead deer to the poor.
• In Maryland, oyster farmers get a tax break, but those who farm other types of shellfish don’t.
• Hawaii gives a $3,000 tax deduction to those who grow state-approved trees.
• A business owner bought a racehorse and claimed it as a business expense. No, he was not in the horse-racing business; he claimed that he needed to entertain his clients and that a racehorse would do just that. The economic stimulus package allowed for a tax deduction as large as $25,000 to be claimed for buying a racehorse, but the deal expired without creating many new purchases.
• An ostrich farmer in Louisiana’s St. Tammany Parish depreciated his ostrich, which is allowed as long as the birds are used for breeding purposes.
• A man was arrested for drunk driving after he waited to sober up--but not for long enough--and wrecked his car. His insurance company refused to compensate him for the wrecked car because he broke the law. The driver, however, was able to deduct the cost of his car as a casualty loss because he acted reasonably. If he hadn't waited to sober up, then it would have been gross negligence and thus nondeductible.
• A man working for a graphic design agency bought a pair of skis from Yamaha Snowmobiles, a company for which he was making a catalog. He used the company discount and then successfully deducted the skis as a business research expense.
• In Germany, one can deduct bribes. While the deduction is seldom used, it does exist as part of the tax code. All one has to do to report it is disclose their name and the name of the official that they bribed.
• The United Kingdom gives tax breaks to video game companies that create "culturally British" games. The criteria for being culturally British is not very clear; the game must score 16 or more of 31 points on a test that was designed to measure the cultural content and contribution of the game.
• In the Netherlands, those who study and practice witchcraft can claim a tax break given out by the government. It has existed for quite some time, but in 2005 it gained the attention of the public after a judge upheld the tax break in court.
• In Italy, almost a third of all men over 30 still live at home. To encourage them to move out, the government issued a 1,000 euro tax break to those who rent their homes. However, the problem is considered to be tied to the difficult job market in Italy that prevents young men from obtaining jobs that will support their independent lifestyles, so critics say it’s unlikely that the tax break will encourage many young Italian men to move out.

source: www.efile.com

 SHARE WITH A FRIEND.
If you need a tax appointment... www.baboiancpa.com