When it comes to tax deductions, there's something to wag about for animal lovers, rescue groups and for people who foster (or are considering) fostering a pet: It's now tax deductible!
A new landmark court case has volunteers barking up a storm about the paw-sitive news! What are the keys to getting the deduction?
"The basic requirements are that the expenses have to be directly related and solely attributable to the rendition of services to a qualified 501(c)(3) organization," said CPA Kevin Long, a Massachusetts-based tax attorney.
Long warns if you're going to claim the deduction, you need to document.
"In addition, you need to have documentation to support the expenses, and the organization needs to provide written acknowledgement for expenses over $250," said Long.
"The written acknowledgement must contain a description of the services provided, a statement of whether or not the organization provided any goods or services as reimbursement, a description and good faith estimate of the value of any goods or services provided as reimbursement and a statement that the only benefit you received was an intangible one (if no reimbursement was made). The written acknowledgement must be obtained on or before the earlier of the date you file your tax return for the year that you made the expenditure or the due date for filing your tax return for that year."
This new development is the cat's meow for people who love animals. But how do you make sure you qualify?
CPA Bryan Knuff shares his tips:
Unreimbursed expenses must be directly connected with and solely attributable to the rendition of services to a charitable organization.
Document all of your expenses. Keep a journal if you need to but detail any expense that is not obvious. Keep your receipts and cancelled checks. You can claim any expense related to their care including vet bills, medicines, supplies, food, etc. It is apparent you can claim cleaning supplies, and a portion of your home utilities if your operation is substantial enough.
For charitable purposes, you can deduct 14 cents per mile.
Be sure what you claim is reasonable.
For any expense incurred over $250, get a receipt from the charity.
Regarding expenses from a different tax year, they must be deducted in the year incurred. You can amend but only up to 3 years back.
If your head is now aching after sifting through "Foster Pet Tax Deductions 101," animal rescue groups say another bottom line you should remember: You will be save furry, cute lives. The moment a dog or cat gets sprung from a "kill shelter" into a foster home, they're off death row.
Christy Glover from Lucky Lab Rescue and Adoption is thrilled by the court decision. "I think this tax write off is great! It will help encourage many people to foster who may have been afraid of the costs involved. Foster homes are a crucial key for success in all rescues," said Glover. "Shelters extremely overcrowded and without available foster homes, many of the animals would be euthanized. Foster homes also help diminish the stress of living in a kennel and help the dog get adjusted to what a home life is like. A little love, a warm bed and a belly rub goes a long way in the life of a dog who prior had no knowledge of this."
Some people think fostering a pet would be emotionally tough, they say, "Oh I'd get too attached." But remember the alternative to not opening your door and heart for a bit could mean "dead dog or cat walkin" for some animals. Seriously, it's foster home or death. It's that terrible and that black and white.
Glover characterizes it like this, "Do you get attached, yes absolutely. However, the joy you receive knowing you played a part in saving a dog's life and helping to make a family complete is by and far the best feeling in the world. They are scared and frightened, it takes a combination of love, hard work and persistence to help the dog get past the hurt and begin to heal and trust again," said Glover.
She adds, "I can tell you wholeheartedly, that what you give out to this dog, is returned to you two-fold. Knowing you not only saved their life but found a home they can thrive in, is an amazing feeling."
If you'd like to get involved in animal rescue, or have a favorite breed you'd like to foster, just jump online and search for local rescue groups, (Example searches: "Massachusetts Lab rescue", "California Pug rescue", "Chicago Calico rescue" or even "Austin cat rescue") they'd love to hear from you… and Uncle Sam sounds like he'll be ready to accept your tax deduction for helping to save a life!
This Watchdog Mary article originally appeared in Yahoo! and Galtime.com