Tax Deductions: Deadbeat Friend Debt and 5 Other Unusual Things You Can Write Off

FabioFilzi /
FabioFilzi /

Most taxpayers aren’t paralyzed with fear from the prospect of filing a tax return, but it is still a serious and sometimes unpleasant undertaking. It may help to brighten the mood by looking at interesting and odd deductions taxpayers have legitimately claimed on their returns, starting with how you can get proper restitution from a dreaded deadbeat friend.

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1. Nonbusiness Bad Debt

When it comes to loaning money to friends, it’s best to heed the sound advice offered in Shakespeare’s “Hamlet”: “Neither a borrower nor a lender be.” According to a 2022 survey, 59% of respondents who lent money said something went wrong, while 42% stated they were never paid back money lent.

We all know or have known of deadbeat friends who have reneged on debts. Luckily, if you can prove you have taken reasonable steps to collect on the debt and the prospect of getting your money back is deemed worthless, the IRS allows you to file a nonbusiness bad debt deduction as a short-term capital loss on your taxes.

2. Swimming Pools

Backyard pools are a magnet for neighborhood kids, but if you can keep them away, you might be able to deduct both the construction and maintenance costs for a pool under certain strict medical conditions. According to Bradford Tax Institute, a swimming pool can be deducted if it is installed to treat a medical ailment (emphysema, bronchitis, stroke recovery, etc.), considered the cheapest and most convenient option and used by the sufferer exclusively.

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3. Pregnancy Treatment and Tests

If you hope to welcome a new addition to your family in 2023, you might be able to deduct unreimbursed medical fertility treatment expenses that exceed (in combination with other qualified medical expenses) 7.5% of your adjusted gross income (AGI) on your personal tax return, including IUI, IVF, embryo/egg/sperm storage, lab fees, and any other procedures and mediations required due to infertility, pregnancy tests, therapy and supplements and vitamins, per Natalist.

4. Quitting Smoking

It’s only February, but if you have already given up on your New Year’s resolution to stop smoking, you may be able to write off expenses to help you quit. In 1999, the IRS authorized taxpayers to count unreimbursed costs of smoking-cessation programs and prescription drugs designed to alleviate nicotine withdrawal as deductible medical expenses. Over-the-counter aids are non-deductible.

5. Breast Augmentation

According to TurboTax, the 1988 case of an exotic stripper who claimed a $2,088 deduction for breast enlargement surgery as a business expense — and her subsequent appeal victory in Tax Court — helped advance the writing off of cosmetic procedures by adult entertainers who can reasonably prove surgery is a condition of employment and that it will have profitable results.

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6. Organ Donation

There are currently over 20 states that provide special tax breaks for living organ donation. Depending on the state in which you live, you can claim an organ donation tax deduction of up to $5,000 (Kansas, Virginia), up to $7,200 (Louisiana), up to $10,000 (Arkansas, Connecticut, Iowa, Maryland, Massachusetts, Minnesota, Mississippi, New Jersey, New Mexico, New York, North Dakota, Ohio, Oklahoma, Rhode Island, Utah, Wisconsin) or up to $25,000 (Georgia) to cover the unreimbursed cost of travel, lodging, lost wages and medical expenses for organ or bone marrow donation (Idaho offers an available organ donation tax credit, not a deduction, of up to $5,000).

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This article originally appeared on Tax Deductions: Deadbeat Friend Debt and 5 Other Unusual Things You Can Write Off