The IRS and accountants have a history of rolling their eyes at such claims, but a court judgment may change that. A woman named Jan Elizabeth Van Dusen sued the Commissioner of the IRS over “unreimbursed volunteer expenses while caring for foster cats in her private residence.”
These expenses primarily included “payments for veterinary services, pet supplies, cleaning supplies and household.” Apparently the IRS nailed her for a $12,068 charitable-contribution that she made on her taxes, but she fought back and largely won. “Largely,” because the court allowed that she could take most of the deduction, minus some expenses that were hard to link solely to pet care.
The U.S. Tax Court, for example, wrote: “Some payments to Orchard Supply Hardware and Lowe’s for pet supplies, however, are disallowed because the amounts spent on pet supplies cannot be determined with precision.”
The upshot? The IRS will recognize expenses related to fostering dogs and cats for approved charities.
An approved charity, in turn, is one that holds 501(c)(3) designation as a Not-for-Profit organization. So things like pet food, medicines, veterinary bills, and crates could all be deductible. The judgment indicates that a portion of household utilities could be considered an expense, provided that an area of your home is dedicated just to caring for the foster animal(s).
Expenses for other charitable work for approved organizations apply as well.
Another important point to remember. If the expenses add up to more than $250, a letter is required from the foster organization confirming volunteer or foster status.
“This is the first time the court has addressed these expenses,” said, Jonathan Lovvorn, chief counsel of the Humane Society, in a release. “Now we want to get the word out.”