Tax season is a time when creative thinkers figure out ways to itemize unusual expenses as deductions to lower their bill to Uncle Sam. Often, though, the Internal Revenue Service doesn’t agree with their ingenuity.
Thirty percent of Americans itemized in 2013 versus taking the standard deduction, with higher income earners doing it more frequently, according to the most recent tax data available from the IRS. For instance, more than 90 percent of taxpayers earning $200,000 or more itemized their deductions that year.
Jackie Perlman, principal tax research analyst at H&R Block’s Tax Institute, says that to pass the sniff test with the IRS, taxpayers should understand what they are deducting and why and know what authority or precedent backs up the deduction.
Otherwise, you could attract an audit and possibly be liable for back taxes, interest and penalties if the agency denies the deduction.
Here are 10 real-life deductions that people took, but only half were O.K.’d by the IRS. Can you tell which are legit or not?