"My sympathy and respect vaporized quite quickly when the surviving spouse showed up in my office to get his tax return prepared the next spring," the CPA says. "His charitable deductions included a list of all the deceased's bras and panties priced quite liberally."
The client not only claimed the deductions -- the IRS allowed them.
If I'd only had a time machine
Walt Hatter, a Fort Worth, Texas, CPA, had heard some tall tales from taxpayers fishing for ways to write off their hobby. But one client beat them all."I had a dentist client who came in and said he was in the fishing guide business," Hatter said. "I said, 'Are you serious?' I didn't believe him. He had to show me that he tried to make money at it."
When the dentist explained that he'd printed business cards, advertised for customers in magazines and devoted two days a week to his new enterprise, Hatter went against his instincts and agreed to allow him to file for a $9,000 loss and depreciate his equipment.
Fortunately, the dentist was on the "deduct now, live the dream later" plan.
"What's funny is, this guy actually retired from being a dentist and went into guiding full time. It was a good lesson to me."
To take an accurate pulse, of course!
Most of us don't know the technical terms for the gadgets and gismos in a doctor's bag, right?So you can understand how Dallas CPA S. Miguel Reyna felt when he was asked to examine the tax return of a physician being audited by the IRS.
"After reviewing his list of assets, we asked specifically, 'What is this "time monitoring system" listed on your books?'" Reyna says.
"He stammered a bit, then raised his shirt sleeve to point to his big sparkling Rolex!"
Or we could simply deduct your cardiologist ...
When you travel for a living, it's easy to forget a minor detail or two about the various business lunches and dinners you attend. Then again, some restaurants are more conducive to accurate record-keeping than others, as Dallas CPA Ken Sibley found out recently."We had an outside salesman client who ate more than two-thirds of his 'meals' at Hooters, but forgot who he entertained and what the business purpose of the meeting was," he says.
Perhaps he was in the control group for a new cholesterol-lowering drug.
Clearly, she was not an Aggie
Forgive Donna Wesling her city upbringing. The Austin, Texas, CPA admits she wasn't raised around livestock, which provided this moment of enlightenment when she was an accountant newbie transplanted to farm country."Back then, there was the Investment Tax Credit (that) allowed for investment in new property," she says. "One of our clients bought a herd of steers and I took investment credit on them when I prepared the return.
"The CPA who reviewed the return called me to his office and told me I could not take the credit on steers. When I asked him why, he responded that you could only take the credit on breeding stock. To which I responded, 'So?'
"He asked me if I knew what a steer was and when I said I knew it was some sort of cow, he gave up and sent me to speak with one of the other females in the office. He was too embarrassed to explain the process of how a male cow became a steer.
"The things they don't teach you in college!"
Create a news alert for "taxes"