Bill being considered to make pet expenses tax deductible...

[headsupheelsdown]

It's called the Happy act, and should we get some momentum going to try and support or promote this?

It is the Humanity And Pets Partnered through the Years act and would allow up to $3500 a year of pet expenses to be tax deductible. I don't know if this is per animal or total per household... but would be sigificant savings at tax time for us horseowners...

Would be interested in everyones thoughts...

[Phaxxton]

Do horses count as "pets" under the bill? Horses are often characterized as livestock under the law, so does this bill include livestock expenses?

[War Admiral]

Unfortunately, thanks to all those breeders who think they have a God-given right to that ag tax exemption, horses are specifically excluded. Which is so unfair. :no: :(

[Phaxxton]

Unfortunately, thanks to all those breeders who think they have a God-given right to that ag tax exemption, horses are specifically excluded. Which is so unfair. :no: :(

Thanks, that's what I thought...

[headsupheelsdown]

Hmmm... that's unfortunate. Because how many horse owners actuallly breed as a business as opposed to just owning their horse as a pet?

AND, in most cases, it costs a heck of a lot more to own a horse than a dog, most horse owners could max out that $3500/year easily.

[War Admiral]

Hmmm... that's unfortunate. Because how many horse owners actuallly breed as a business as opposed to just owning their horse as a pet?

Trufax. Plus, how many breeders per capita spend as much per capita on their horses as a private owner does? Very darn few, I suspect.

[Void]

Well if horses aren't included sounds like caring for a Dog is free! lol

[PoochPaddock]

Well if horses aren't included sounds like caring for a Dog is free! lol

I think this is a wonderful thing as so many people across the country are having to give up their pets due to the horrible state of the economy. Having this additional deduction could mean the difference between keeping a pet vs. sending it to a shelter (or worse). Kudos to congress for introducing a piece of legislature from which people in all tax brackets can benefit!

[poltroon]

I think this is a wonderful thing as so many people across the country are having to give up their pets due to the horrible state of the economy. Having this additional deduction could mean the difference between keeping a pet vs. sending it to a shelter (or worse). Kudos to congress for introducing a piece of legislature from which people in all tax brackets can benefit!

People who are giving up pets for financial reasons probably don't pay enough in taxes to get much benefit from a tax deduction.

[YankeeLawyer]

People who are giving up pets for financial reasons probably don't pay enough in taxes to get much benefit from a tax deduction.

Exactly

[War Admiral]

People who are giving up pets for financial reasons probably don't pay enough in taxes to get much benefit from a tax deduction.

Maybe not, but it might make the financial difference for pet owners whose pets need major surgery they can't afford... I totally support the bill - just wish it included horses, that's all. :(

[Phaxxton]

Maybe not, but it might make the financial difference for pet owners whose pets need major surgery they can't afford... I totally support the bill - just wish it included horses, that's all. :(

I wish it applied to horses, too, but I'm not so sure that it will make a significant financial difference for most people. It will of course make some difference come tax time, but this is a tax deduction, not a tax credit. You don't get back the full amount of what you spend; it just decreases your gross adjusted income. Yes, that does decrease your tax liability, but it doesn't translate to dollar-for-dollar savings. Not sure it will make a huge difference for someone who does not have the cash to spend on surgery, etc. Maybe it will, though, which would be great.

[JinxyFish313]

That would be cool, but I doubt that it would pass.

Having spent $7000 this summer trying to save my 6 yr old Min Pin (she had kidney stones stuck in her ureters), I wish this legislation existed now.

[War Admiral]

I wish it applied to horses, too, but I'm not so sure that it will make a significant financial difference for most people. It will of course make some difference come tax time, but this is a tax deduction, not a tax credit. You don't get back the full amount of what you spend; it just decreases your gross adjusted income. Yes, that does decrease your tax liability, but it doesn't translate to dollar-for-dollar savings. Not sure it will make a huge difference for someone who does not have the cash to spend on surgery, etc. Maybe it will, though, which would be great.

Oh, I think it will. There have been many years where I've worked enough overtime to kick me up into the next tax bracket by, like $1 or $5 - and ended up owing way more than I should - you can BET that deduction would be awesome!

[AM]

It isn't just the breeders who are receiving that agriculture tax advantage. So is your boarding barn. I imagine your board increase would swallow up the tax credit if horses were reclassified as pets.

[Meliora]

Thanks AM....Without the Ag exemption for my facility, the county would try to reclassify my preoperty (& all horse property) as commercial:eek: That would mean $50,000-$100,000 in taxes on the 10 acres each year. There is no way that any one could afford to board a horse or own enough propery to keep one. Please be careful what you wish for.

[Woodsperson]

Oh what a deduction I would have.

[Phaxxton]

Oh, I think it will. There have been many years where I've worked enough overtime to kick me up into the next tax bracket by, like $1 or $5 - and ended up owing way more than I should - you can BET that deduction would be awesome!
Yes, but if your dog needed surgery in August that you didn't have the money for, would a tax deduction coming next winter make a difference in whether or not you could afford it when the dog needs it?

[poltroon]

Oh, I think it will. There have been many years where I've worked enough overtime to kick me up into the next tax bracket by, like $1 or $5 - and ended up owing way more than I should - you can BET that deduction would be awesome!

That's not how brackets work. You only pay the higher rate on that $1 or $5 that is over, not on your whole taxable income.

Ex (tax tables faked for simplicity:)
$0- $15,000 - 0%
$15,000 - $25,000 - 15%
$25,000 - $50,000 - 25%

if your taxable income is $25,005, your tax is 0 * ($15,000) + .15 * (25,000-15,000) + .25 * (25,005-25,000) =

0 + $1500 + $1.25.

You're still $3.75 better off earning that extra $5.

[jr]

Am I the only one that thinks this is nuts? We have an ever increasing national debt, trillions in unfunded social progam liabilities, and a government throwing dollars at anything that moves. We have a government that is considering limiting the deduction for charitable contributions for many Americans, but is willing to give me a tax break for owning a dog....????? My contribution to the Cancer Society might not be tax deductible, but Buffy's heartworm would be? How does that make sense.

Agree with several that most of the folks that have issues with the costs of owning a dog don't pay a lot (or any) taxes to begin with.

[headsupheelsdown]

No, it's not nuts. Wouldn't this kick back like $750 extra bucks in an average return? Then, what would most of us do? Spend it, generating taxable income or taxable revenue. PLUS, it would be a nice treat that would pay a year's medical insurance to cover a horse and spring shots, or could pay board and spring shots or could mean that someone could go to an extra big show. It would help the horse industry in general thrive... and when our industry thrives, we all benefit. For all the tax breaks that big corporations and everyone else gets, it would be really nice to do something for our faithful friends.

I wish they could make exceptions for horses that are companions or pets.

[War Admiral]

It isn't just the breeders who are receiving that agriculture tax advantage. So is your boarding barn. I imagine your board increase would swallow up the tax credit if horses were reclassified as pets.

See, I have no problem whatsoever w/ boarding barns taking the ag. exemption; they ARE a legitimate business. "Hobby breeders".... not so much.... The rest of us are basically paying for your hobby. For sh*t sure nobody subsidizes ours!

[JinxyFish313]

Ugh. After talking about this with lots of people yesterday, I get a call at the barn last night from DBF "I was playing with the puppy and yadda yadda yadda I stepped on him and now he's limping". I took the poor gimpy puppy to the ER and got some pain meds. They don't think its a fracture but we might still have to do xrays if he doesn't get better.

[BelladonnaLily]

Unfortunately, thanks to all those breeders who think they have a God-given right to that ag tax exemption, horses are specifically excluded. Which is so unfair. :no: :(

So, do you think a "pet tax exemption" is more "fair" than an "ag tax exemption"? If so, why?

I personally don't think we can afford it, especially with all of the tax dollars that might be needed for the proposed health care reform. If a tax exemption is going to make or break a person financially, then they can't afford $3,500/yr to take care of a pet. JMHO.

[JinxyFish313]

I don't think the proposed tax change is designed to get people to pay for things they otherwise wouldn't. To me it seems like just another way to get some money back into the economy and at the same time give people who have pets instead of kids a little benefit.

[ShotenStar]

Am I the only one that thinks this is nuts?

I am right there with you and have written to my congressman expressing this point. I think a bill like this opens the door to more tax fraud and animal abuse. If animal WELFARE is the goal there are better ways to do it.

*star*

[hype]

This is what is wrong in Washington. We've got ridiculous bills which are introduced like this one, probably to give the one penning the bill his/her 10 minutes of CSPAN footage.

We've got an unprecedented deficit, serious international problems, terrorism, health care issues, educational cuts, homelessness etc etc and someone is wanting to introduce a tax cut for pets?

Don't get me wrong, I love my animals and can't imagine life without them but to introduce a tax cut for this is absurd.

SOMEONE is footing the bill for everything that our government is voting into law. While it may sound like a good idea for you to get a tax break for something you already have eventually YOU will be paying for someone else's ridiculous bill. We need to think about that very thing when our Senators and Congressmen are introducing such bills.

I for one would like to keep my hard earned money and have my pets on my own dime rather than paying for someone else's pets or whatever else our government decides to subsidize next time around.

Remember the original plateau in which our government was founded? "A government by the people for the people." The government should do things for the greater good such as roads, transportation etc and the special interest groups are ruining it for everyone. We've gotten so far removed from the common good interests and are now all about what can the government do for me personally.

[SaddleFitterVA]

I love my too-many pets (and horses) but do not think this is a good idea, we cannot afford it, and really there are many other things in this country that is more deserving of tax relief than pet vet bills.

Even though I'd use it if it was there...just like I use the tax subsidized home ownership (aka mortgage interest deduction) plan that is a sacred cow.

But, do not confuse Ag exemption, which is generally a state (or county) determined status for calculating real estate taxes, with a federal income tax deduction.

[danceronice]

Personally, I'd rather take a tax exemption for my cats and dog than keep having to pay more than someone my age with kids--my pets are a lot less expensive to the goverment over time than someone who can't use human birth control. Why is there the assumption that if I'm single and childless I have nothing better to spend my money on that someone else's schooling and health care? If I wanted to pay for children I'd have my own. It'd be nice if those of us who are single got a few breaks somewhere.

Sorry, but nothing makes me LESS charitably inclined than having the state or feds determine that at my income level, I owe, even though if I made EXACTLY THE SAME AMOUNT and produced an illegitimate child or two I would not only not pay taxes, I'd qualify for state-funded health care. Obviously if I'm single and know how to use birth control I have nothing better to do with my money than pay for other people. I'll take a deduction on my pets, and anything else I can deduct, too.

[YankeeLawyer]

See, I have no problem whatsoever w/ boarding barns taking the ag. exemption; they ARE a legitimate business. "Hobby breeders".... not so much.... The rest of us are basically paying for your hobby. For sh*t sure nobody subsidizes ours!

Actually, that is incorrect. People who pursue hobbies are entitled to certain deductions, which are claimed as itemized deductions - regardless of whether the hobby is breeding or some other hobby.

http://www.irs.gov/irs/article/0,,id=186056,00.html

Business expenses - ordinary and necessary expenses for conducting a for profit business -may be deducted and offset against other income. That would include breeding businesses. The law does not accord special privileges to hobby breeders.

[TrotTrotPumpkn]

FYI, danceronice, I'm married without kids. I also spent about 5k on vet bills between the horses and the dogs and cats this year. That doesn't include oridnary ownership expenses. And I pay taxes too. That said, this has me so mind boggled and foaming at the mouth that I can't even come up with an articulate response at this point.

Beyond the health care issue, which I don't even want to touch, has anyone else looked at his/her most recent social security statement? You really should (and read the lines about how it is going to be reduced). And then I can't wait until Congress finally looks at the real elephant in the room: Medicaid and Medicare...don't worry, it won't be for a few years--we can't be proactive about anything, but must wait for the crisis. Isn't good for votes to talk about stuff like that now.

Don't get me started on cash for clunkers.

I didn't know hobby breeders got deductions you guys...I think YL is right.

[hype]

As a nation we have become so entranced in the "what's in it for me" type of thinking that we can't see the forest through the trees.

We've got some serious issues and while I would personally benefit from a tax break like this I would never endorse it.

We're cutting teachers, education, research funding, health care benefits, etc etc We can't afford to start handing out tax credits or breaks for things like this. We just don't have the money to do it.

Look at the mess California is in. They've continued to vote for things like this and can't pay for it. Someone once said that if Washington was run by a bunch of single mothers that the budget would be balanced. You shouldn't eat steak when all you can really afford is mac and cheese. The sooner everyone realizes that we just can't afford many of the things our government is proposing the better off everyone will be.

Do what you can when you can, there is a time and place for everything and this is neither the time nor the place to start handing out tax credits.