Reducing Pet Costs: Tax Deductable Pets?
For the penultimate post in the Reducing Pet Costs series, let’s talk about another great American tradition (besides pet ownership) – Taxes! While we may treat our pets like our children, we don’t have the benefit of claiming them as a dependant on our tax forms. Is this fair?
One of the most-emailed articles from this week’s New York Times, titled Pill- Popping Pets (requires free login) has this illuminating paragraph:
Marketers have a new name for the age-old tendency to view animals as furry versions of ourselves: “humanization,” a trend that is fueling the explosive growth of the pet industry and the rise of modern pet pharma. Americans forked over $49 billion for pet products and services last year, up $11.5 billion from 2003; other than consumer electronics, pet products are the fastest-growing retail segment. The market expansion is being driven both by more pets and by more spending per pet, especially by affluent baby boomers whose children have graduated from college. “I get asked all the time, ‘What is it with this humanization — do we suddenly love our pets a whole lot more?’ ” says David Lummis, who analyzes the pet industry for the market research firm Packaged Facts. “My theory is that it’s always been there, but it’s been sanctioned now. It’s not just the crazy cat lady. It’s marketers and all of this consumer advertising that have made it O.K. to spend tons of money on your pet.”
While it’s becoming more and more socially acceptable to spend money on our pets, those of us in a pets-only household are still disadvantaged when it comes to our taxes. Most of us take this fact in stride- we never expected to be able to claim our pets as dependants. However, there is a movement of people who are lobbying for pets as dependents based on quality-of- life issues. In Defense Of Animals is one of these groups, and from their website, they write:
Americans spend over $9 billion a year on veterinary care for their animal companions. Additional expenditures such as food, shelter, and other necessities collectively cost billions of dollars more. People can claim children and other human dependents on their taxes and pay the government less money. Yet animal companions remain ineligible for deductions, despite the fact that they depend on their guardians no less than children depend on their parents.
The government has been taking more steps toward recognizing how important animal companions are in people’s lives. In the wake of Hurricane Katrina, in which hundreds of guardians refused to leave the disaster zone because rescue units would not allow them to take their animals to safety, legislators passed the Pets Evacuation and Transportation Standards (PETS) Act. The recent Menu Foods recall that has killed nearly 4,000 cats and dogs may prompt new laws to protect animals from future foodborne diseases. Allowing tax deductions for animal companions would fall squarely in line with this growing trend.
I’m marginally persuaded that tax deductions for pets makes sense when I remember some of the other crazy tax deductions allowed, such as gambling losses, a pro-body builder’s deduction of mineral oil and those crazy, large, over-a-ton SUV’s. But on the other hand, I wonder if passing this law would increase the number of un-cared for animals by people abusing the system in order to qualify for a tax break. And would different pets (and different breeds) have different values? Overall, is it just plain silly to think we should get a tax deduction for our pet expenses- especially since we Americans are spending more and more on pet luxuries than necessities? The jury is still out for me- what do YOU think?