Non-Deductible Expenses

Non-Deductible Expenses Overview

Determining what is and what is not a deductible expense can be a frustrating and inexact exercise. Particularly daunting is the fact that if you make the wrong determination about an expense, it could result in an audit, interest, and penalties.

Below is a checklist for you to use in identifying expenses the IRS has determined are non-deductible. The list is not all-inclusive, but contains the most common nondeductible expenses. In other words, when preparing your taxes, do not assume that an expense is deductible just because it's not on this list.

_______ Broker's commissions that have been paid in relation to your IRA or other investment property
_______

Burial or funeral expenses, including the cost of a cemetery lot

_______

Capital expenses

_______

Car licenses

_______ Marriage licenses
_______

Dog tags

_______ Home repair, insurance, and rent
_______ Hobby losses
_______ Illegal bribes or kickbacks
_______ Personal disability insurance premiums
_______

Personal living or family expenses

_______

The value of wages that were never received.

_______

Lost vacaction or sick time

_______

Campaign expenses and legal fees associated with running a campaign

_______

Check-writing fees on a personal checking account

_______

Membership dues for any club organized for business, pleasure, recreation, or other social purpose (this does not include professional societies)

_______

The cost of transportation between your home and your main or regular place of work

_______ Fines or penalties paid to a government entity for violating a law
_______

Health club expenses, even if your are required to stay in shape for your job

_______

Homeowners' insurance premiums

_______

Home security systems, assuming you do not have a home office in your home

_______

Expenses related to attending a convention, seminar, or similar meeting for investment purposes

_______

Life insurance premiums, unless they are part of an alimony payment

_______

Lobbying expenses to influence legislation, to participate in any political campaign for or against a candidate, to influence the public in regard to elections, legislative matters, or referendums, or to communicate directly with branch office officials to influence official actions

_______

Any portion of a contribution to a tax-exempt organization that is used for lobbying purposes

_______

Expenses related to eating lunch with your coworkers, except while away on business

_______

Expenses related to meals necessitated by working late unless you are out of town or it is part of entertaining clients

_______

Legal expenses associated with gaining custody of your children

_______

Legal expenses associated with civil or criminal charges resulting from a personal relationship

_______

What you have to pay in damages in a personal injury suit

_______ Legal fees associated with preparing a will
_______ What you have to pay in a divorce settlement
_______

Contributions made to a political candidate, campaign committee, or newsletter fund

_______

Accounting certificate fees for the initial right to practice accounting

_______

Bar exam fees and other incidental expenses in obtaining admission to the bar

_______ Medical and dental license fees to obtain initial licensing
_______

Expenses associated with radio and television appearances meant to increase your personal prestige or professional reputation

_______

Contributions made to a coworker who can not work due to illness or job-related injuries

_______

Basic local telephone service charges for the first telephone line to your residence, regardless of whether it is used for business

_______

Expenses associated with attending shareholder meetings if your only association with the company is your stock investment

_______

Expenses associated with producing tax-exempt income

_______

Interest on a debt incurred to purchase tax-exempt securities

_______

The cost of a wristwatch, even if your job requires strict timeliness

_______

Clothing for work that is not worn as a condition of employment or is suitable for everyday wear

_______

Most personal interest

_______

Most service charges

_______

Annual fees on personal credit cards

_______

Finance charges on credit cards, installment contracts, and revolving charge accounts incurred for personal expenses

_______

Late payment charges by a public utility

_______

Federal income taxes

_______

Most estate, inheritance, legacy, or other succession taxes

_______

Gift taxes

_______ Social security taxes withheld from your pay

Get a Free Attorney Match for your Tax Problems

You never really look forward to expenses, except when tax season rolls around. While they can definitely help reduce your tax liability, they're only helpful if they're actually deductible. When you're preparing your taxes, you want to enlist the help of an expert to ensure that you're claiming all the right expenses. Get in touch with an expert tax attorney near you today and you can receive a free initial evaluation of your tax situation.

Next Steps

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