The 10 Most Creative Tax Deductions for Small Business Owners

Jennifer Dunn

Jennifer Dunn

Contributor at Fundera
Jennifer Dunn is a small business contributor for Fundera and owner of Social Street Media. She is also the community manager at GoDaddy Online Bookkeeping, and her long-standing life goal is to learn something new every day.
Jennifer Dunn

When you own a business, it can seem like you’re constantly shelling out money just to keep afloat. Fortunately, many of these expenses will net you a small business tax deduction at the end of the year. But, you want to cautious and careful about those deductions. The best thing to do is to call your accountant and ask them about any creative tax deductions you should be aware of.

If you aren’t quite sure what to ask your accountant about or fear that Uncle Sam wouldn’t accept “this” or “that” as a legitimate business expense, take a look at some of the most creative tax deductions that business owners have successfully gotten past the IRS:

  1. Body Oil – Yes, body oil. A Wisconsin professional body builder was able to convince the IRS that the body oil he used to showcase his rippling muscles was a necessary business expense.
  2. Dinah Shore’s Ball Gowns – Actress Dinah Shore was able to get away with a tax deduction for the fancy dresses she wore on her television show because she was able to prove that they were so tight that she couldn’t even sit down in them, thus she could only use them for the business of show business. Dinah shows how crucial it is to show how something, no matter how out there it may be, is related to business and business alone.
  3. A Trip to the Caribbean – How about a creative tax deduction that comes with a side of rest and relaxation? Business conventions held in some spots in the Caribbean are eligible for a tax write-off, and you don’t have to tell Uncle Sam why you choose that exotic locale. Sadly, more far-flung destinations don’t garner the same write off unless you can prove you held your convention in that location for a special, strictly-business, reason.
  4. Dog Food – No, we don’t mean Fido the family pet. But if you use a dog to guard your business then he just might be a tax write off.
  5. …And Cat Food – Owners of a scrapyard were able to deduct the cat food they set out to attract feral cats. Their reasoning? The cats kept away snakes, rats, and other pests, thus eliminating a business safety hazard! That’s brilliant for business and their pocketbook. Again, these creative business tax deductions should get your wheels turning. What things does your business pay for to keep running that you’re not writing off?
  6. Breast Implants – Topless dancer “Chesty Love” was able to prove that her earnings increased as the result of her surgical augmentation, and a tax court upheld that her tax deduction for breast implants was very real. Although this wouldn’t apply to most small business owners, it continues to emphasize the fact that a deduction might seem odd, but if you actually need it to run your business, it could be legitimate.
  7. Legal Fees – Even if you’ve been up to some shady business in your business, the legal fees you wrack up while battling the charges are tax deductible. Seems crazy, we know.
  8. Fines – Do you know those fines that your favorite sports stars receive for things like wearing a sombrero on the field? Players can actually write off those huge amounts on their taxes! While this technically won’t apply to your small business, it might help you feel a bit better the next time your favorite player gets slapped with a fine.
  9. Carrier Pigeons – One businessman was so distrustful of modern technology that he employed carrier pigeons to communicate with his business partner across town. And guess what? The IRS allowed it. We’re curious to learn more about how he was able to execute this. But, good for him for finding such a creative way to run his business AND such a creative tax deduction.
  10. Nose Surgery – A wine shop owner convinced the IRS that his nose surgery was a necessary medical expense since he relied so heavily on his sense of smell to run his shop. Wonder if any other wine shop owners have followed in his footsteps?

While, yes, these were some of the kookiest and most creative tax deductions we could find, you might be surprised what you can (and cannot) write-off. Always talk to your accountant about deductions and how to prepare for them throughout the entire year. Best of luck this tax season!

Have you ever taken a “creative” small business tax deduction? What was it?

Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved, or otherwise endorsed by any of these entities.
Jennifer Dunn

Jennifer Dunn

Contributor at Fundera
Jennifer Dunn is a small business contributor for Fundera and owner of Social Street Media. She is also the community manager at GoDaddy Online Bookkeeping, and her long-standing life goal is to learn something new every day.
Jennifer Dunn

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