Breaking News On Tax Breaks For the Animal Rescuers Among Us
They really should have come up with a better title. It’s The Wall Street Journal, after all. But don’t get me wrong. I was overjoyed to read the outcome of the story summarized in Stray Cat Strut: Woman Beats IRS which appeared in the WSJ’s weekend edition this past Saturday.
Amidst all the nasty news of the day (tornadoes, fires and sex offenders … oh my!), I couldn’t help but smile at the eccentric storyline afforded by the kind of woman I have no business assuming I might not morph into someday.
This 59-year-old, unemployed professional looking to find a way to deduct her ridiculously high cat-rescuing expenses bested the IRS when a judge ruled that her activities legitimately amounted to a charitable donation worthy of a tax deduction.
Here’s an excerpt that serves to explain it a little better than my run-on sentence does:
When Jan Van Dusen appeared before a U.S. Tax Court judge and a team of Internal Revenue Service lawyers more than a year ago, there was more at stake than her tax deduction for taking care of 70 stray cats.
Hanging in the balance were millions of dollars in annual tax deductions by animal-rescue volunteers across the nation — and some needed clarity on the treatment of volunteers' unreimbursed expenses for 1.55 million other IRS-recognized charities.
Early this month, Ms. Van Dusen learned she had won her case. "I was stunned," she said. "It feels great to have established this precedent."
The Tax Court allowed her to take a charitable deduction for expenses she incurred while taking care of the cats in her home for an IRS-approved charity, Fix Our Ferals. Among the $12,068 in expenses she deducted: food, veterinarian bills, litter, a portion of utility bills, and other items such as paper towels and garbage bags.
The decision, in Van Dusen v. Commissioner, paves the way for volunteers of animal-rescue groups like the ASPCA and Humane Society of the U.S. to deduct unreimbursed expenses that further the groups' missions, such as fostering stray animals.
It also clarifies rules for anybody deducting unreimbursed charitable expenses of $250 or more, especially if they involve use of a home. It affects donors to charities and religious groups, but not political organizations.
So the deal is this: As long as the taxpayer keeps records of the pertinent expenses and the charity writes a letter acknowledging the gift, then any legitimate expenses in excess of $250 — even if we’re talking about rescue animals — can be deducted.
All we oddball animal rescuers have to do is formally align ourselves with an established charitable organization and do what we already do best to get the deductions any other charitable donor would be entitled to. Brilliant, right?
Though those who worry that tax breaks for the crazy cat ladies among us might amount to a license to hoard, well … sure, in some cases. But for the rest of us? It’s one more incentive to take on the next needy case.
That’s how I see it anyway. How about you?
Dr. Patty Khuly