Red Blood Cell Depletion Allowance
To give some background, you should know that firms that remove natural deposits of minerals such as iron ore or coal from the ground can get a depletion write-off on their tax returns. Now onto the story!
A woman made more than $7,000 in a year by donating plasma because she has a rare blood type. Consequently, her aim was to offset the income by claiming a depletion deduction for the loss of her blood’s mineral content on top of her blood’s ability to regenerate.
The Tax Court ruled that individuals cannot claim depletion on their bodies and that the deduction is specifically aimed at firms!
A Trophy Collection
If you want to share some of your earnings then donating to charity is one of the most important steps you can take. On top of helping out those in need, the IRS will reward you with charitable deductions. Things get a little bit more complicated when you chose to donate non-cash contributions.
A big-game hunter did just chat, claiming a whopping $1.43 million write off for animal skulls, hides, horns, and other hunting specimens. How, exactly, did he come to this figure?
Well, he claimed that it would be impossible to put a price on his “museum quality” collection so he based his deduction on the cost it would take to replace them. As such, he considered the cost of returning to Africa and what it would take to shoot more animals and ship them back to the U.S.
Experts on taxidermy were called in court and in the end, the Tax Court sided with the IRS who only allowed a deduction of $163,045. The IRS also claimed that the items the big-game hunter had donated were just “remnants and scraps” anyway.
