There are many items which you feel as legitimate for claiming as a deduction. However IRS has made some specific rules under which these items are NOT deductible. Let us go through the important items in the list –
- Adoption expenditure – You Cannot Deduct Expenses of adopting a child on your tax return. However you can claim a credit for those expenses by filing form 8839, Qualified Adoption Expenses.
- Burial or funeral expenditure, including the cost of a cemetery lot.
- Campaigning expenses – You cannot deduct expenses of a campaign for a candidate for any office even though the candidate is running for re-election to that office.
- Certain capital expenditure – If you spend some money to buy a property which has a useful life substantially beyond the tax year, then such expenses are treated as capital expenses and must be added to the cost of the property.
- Club dues – The cost of membership in any club organized for business, pleasure, recreation or any other social purpose is non-deductible. This includes business, social, athletic, luncheon, sporting, airline, hotel, golf and country clubs.
- Commuting costs – The cost of commuting from your home to your main or regular place of work is not deductible.
- Parking tickets – Parking tickets are issued for violation of traffic rules. You cannot claim such charges as a deduction.
- Costs on a health spa – You may try to claim these costs under the reason – essential for keeping your health in excellent condition as a job requirement. However, these are personal costs and cannot be claimed as a deduction.
- Home Security System – If your install a Home Security System, you cannot claim such costs as deduction. However if you have a home office, you can claim such cost as a business expense.
- Life Insurance premiums – The premiums you pay on your Life Insurance are not deductible. However if you pay premiums on Life Insurance policies assigned to your former spouse, you can deduct them as alimony.
- Amounts spent on Lobbying – You cannot deduct amounts paid towards lobbying including expenses to influence legislation, or to participate in any political campaign.
- Personal legal costs – Costs for custody of a child, expenses for preparation of a will, damages for personal injury are all personal and hence not deductible.
- Political Contributions – Contributions made to a political candidate or to a campaign committee are not deductible.
- Professional accreditation fees – Fees paid for their initial right to practice accounting, bar exam fees, medical and dental license fees to get initial licensing are all nondeductible items.
- Residential telephone service – You cannot deduct any charge for basic local telephone service for the first telephone line to your residence even though the line is used in a trade or business.
- Expenditure relating to tax exempt income – You cannot deduct expenditure relating to get tax exempt income like tax-exempt interest.
- Wristwatches – The cost of wristwatch cannot be deducted even though there is a job requirement that you should know correct time to perform your duties.
If you claim any of the above items on your tax return as a deduction, they are certainly going to be disallowed and you will be charged with additional taxes as well as penalties for underpayment of taxes. So it is always advisable to keep away from all these deductions on your tax return.