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Extraordinary Tax Deductions: 10 Successful Claims You Won't Believe

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Extraordinary Tax By Peter Blank, Editor, The Kiplinger Tax Letter

Okay, admit it: As you've struggled with your tax return, trying to come up with some extra deductions to pump up your refund or reduce what you owe, you've taken a few flights of fancy. "Can I claim a deduction for all those blood donations at the Red Cross?" Nope. "How about a charitable contribution for all the time I donate to the church?" No, again. "Can I count the wedding gift for my boss's daughter as an employee business expense?" Come on!

On the other hand, some of your fellow taxpayers have successfully claimed write-offs for many things that most of us wouldn't even imagine, ranging from cat food to a casualty loss for a vehicle totaled by a drunk driver.

Here are our favorites.



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What is IRS Form 8824: Like-Kind Exchange

Ordinarily, when you sell something for more than what you paid to get it, you have a capital gain; when you sell it for less than what you paid, you have a capital loss. Both can affect your taxes. But if you immediately buy a similar property to replace the one you sold, the tax code calls that a "like-kind exchange," and it lets you delay some or all of the tax effects. The Internal Revenue Service (IRS) uses Form 8824 for like-kind exchanges.

What are ABLE Accounts? Tax Benefits Explained

Achieving a Better Life Experience (ABLE) accounts allow the families of disabled young people to set aside money for their care in a way that earns special tax benefits. ABLE accounts work much like the so-called 529 accounts that families can use to save money for education; in fact, an ABLE account is really a special kind of 529.

What is IRS Form 8829: Expenses for Business Use of Your Home

One of the many benefits of working at home is that you can deduct legitimate expenses from your taxes. The downside is that since home office tax deductions are so easily abused, the Internal Revenue Service (IRS) tends to scrutinize them more closely than other parts of your tax return. However, if you are able to substantiate your home office deductions, you shouldn't be afraid to claim them. IRS Form 8829 helps you determine what you can and cannot claim.

What is IRS Form 8859: Carryforward of D.C. First-Time Homebuyer Credit

Form 8859 is a tax form that will never be used by the majority of taxpayers. However, if you live in the District of Columbia (D.C.), it could be the key to saving thousands of dollars on your taxes. While many first-time home purchasers in D.C. are entitled to a federal tax credit, Form 8859 calculates the amount of carry-forward credit you can use in future years, not the amount of your initial tax credit.

What is IRS Form 8379: Injured Spouse Allocation

The Internal Revenue Service (IRS) has the power to seize income tax refunds when a taxpayer owes certain debts, such as unpaid taxes or overdue child support. Sometimes, a married couple's joint tax refund will be seized because of a debt for which only one spouse is responsible. When that happens, the other spouse is said to be "injured" and can file Form 8379 to get at least some of the refund.

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ORIENTLADY11

NO WONDER WE ECONOMICALLY LOSS EVERYTHING BECAUSE OF WIERD PEOPLE. HE WANTED SEX CHANGE, THEN GO FOR IT, BUT DON'T MAKE TAX PAYER PAY FOR UR STUPID WIERD THINGING...NOT A HATER, BUT THIS IS TOO MUCH!!! JUST SAYING

January 30 2012 at 10:01 PM Report abuse rate up rate down Reply
ORIENTLADY11

wow! a guy who God made him a man then wanted to be a woman wanted tax on his stupidity? Yes it is stupidity. Like if u wanted to buy clothes, store got ur tax, but u will never get it back...he wanted to sex change, then he obviously wanted to spend money, then why letting tax payer pay for his stupidity? He choose to be one...then obviously got that money for his sex change, now he wanted IRS pay that No way...u wanted something, then go for it, but don't let others pay for ur wierd thing, duh! If IRS pay for this, then they will support those wierd people on their "dumb" stupidity...sorry, but it is...SODOMY is not supported by the CREATOR, he actually destroy those cities...SODOM and GOMORRAH! No way as a tax payer pay the stupid things people they do...he wanted sex change, then don't complain...he wanted it, then don't as IRS pay him from TAXPAYER'S MONEY...geez!

January 30 2012 at 9:58 PM Report abuse rate up rate down Reply
Dave Templeton

Help Send Congress to Jail. Congress making +8% using "Insider Trading" on company info 'before' the public is aware of it! Martha Stewart sold about $230,000 in ImClone shares on December 27, 2001 just a day before the announcement of FDA decision and was sent to jail for "Insider Trading"!

January 26 2012 at 3:29 PM Report abuse rate up rate down Reply
groman00

What's the online tax tool? Turbotax?

January 26 2012 at 9:47 AM Report abuse rate up rate down Reply
scottee

Politicians are the only people in the world who create problems and then campaign against them.

Have you ever wondered why, if both the Democrats and the Republicans are against deficits, we have deficits? Have you ever wondered why, if all the politicians are against tax cheats, we have tax cheats?



One hundred senators, 435 congressmen, one president and nine Supreme Court justices - 545 human beings out of the 235 million - are directly, legally, morally and individually responsible for the domestic problems that plague this country.

maybe, we the people, need to vote out every incumbent in Washington, every election, every time...just to make them squirm...to make them fear for their job?

January 25 2012 at 8:13 AM Report abuse +3 rate up rate down Reply
Patricia

I cant beleive these people got to take tax deductions for this stuff. Ok maybe they are all in that 1%, they get anything.

January 24 2012 at 5:52 PM Report abuse -3 rate up rate down Reply
1 reply to Patricia's comment
chrisp442

your an idiot. anyone can do it, its just the smart people who do so. we know going in ahead of time what we can and can't write off. we took the time to learn these things because we knew it was worth our while while you played video games. maybe only a select few take advantage because the 99% are to busy crying to learn how to do so themselves. myself for example. I write off a portion of my bills because i rent a legal apt out of part of my house. i charge a flat rate for rent and include cable, phone, internet, heat, water, electric and then i deduct a % based on sq feet as expenses for the apt. I pay tax on the rent i make so why should i go look for ways to write stuff off? I learned that i was allowed to do that by reading, not by crying, you should try it sometime

January 24 2012 at 6:40 PM Report abuse rate up rate down Reply
1 reply to chrisp442's comment
Carol Q

I am in the 99% and I don't whine. I don't support the occupiers and I definitely don't support you. You have a condescending attitude. The fact that you need to have that attitude tells me you are disastisfied with your life so being super rich does not mean you are happy. I am content and satisfied with where I am. I don't feel the need to put down others who are not where I am, nor do I whine or despise those who are in the 1%. I don't have to be super rich to love my life, and I certainly do not think I am better than anyone else.

January 26 2012 at 5:04 PM Report abuse rate up rate down
mrrsmhen

JEWS NEVER STOP THEIR LYING, SCAMMING AND CHEATING. ITS NO WONDER EVERYONE HATES THEM.

January 24 2012 at 5:30 PM Report abuse -14 rate up rate down Reply
4 replies to mrrsmhen's comment
leandercannon

sorry Nancy ... bush gave up that deduction to get a tax cut for the rich in 2008.......

January 24 2012 at 5:26 PM Report abuse rate up rate down Reply
1 reply to leandercannon's comment
Mikey D

tax cut for the rich? everyone got a tax cut, not just the rich. Get the story right!

January 24 2012 at 6:15 PM Report abuse rate up rate down Reply
AmericanCCI

Leave the guy alone, every one needs all the deductions thet can get, or the goverment might have a little more money to waist!!!!!!!!!!!

January 24 2012 at 5:07 PM Report abuse +1 rate up rate down Reply
Nancy

Can I deduct property and school taxes if i don't itemize my dedutions.

January 24 2012 at 4:34 PM Report abuse +1 rate up rate down Reply
2 replies to Nancy's comment
mpmcrill

no

January 25 2012 at 1:58 PM Report abuse rate up rate down Reply
Jackie

Clarification: You can deduct these for rental properties that you own, on a Schedule E. Also, a small percentage of these may be deducted on a form 2106 for employee business expenses, provided you have a home office for your employer's convenience that is exclusively used for that purpose.

January 31 2012 at 12:43 AM Report abuse rate up rate down Reply