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A 'HAPPY' Tax Break for Pet Owners?

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Better sit your furry 'tocks down for this one. Introduced on July 31, a proposed bill (HR 3501), Humanity and Pets Partnered Through the Years, or 'HAPPY Act,' would give pet owners a sizable tax break. The primary sponsor, Rep. Thaddeus McCotter (R-Mich), reasons that the economic crisis has negatively affected all Americans and pets should not be excluded in tax relief solutions. 

The bill would basically amend the IRS code to allow an individual to deduct up to $3,500 in a taxable year for qualified pet care expenses. The bill defines qualified deductions as "amounts paid in connection with providing care (including veterinary care) for a qualified pet expense other than any expense in connection with the acquisition of the qualified pet."

The bill's language specifically defines a qualified pet as a "legally owned, domesticated, live animal." Evidently, the bill does not include research animals or those used in a business, such as breeders or lion tamers.


"Well, we've had reports of people having to turn in pets because of the economic recession. And when you think about the relationship between people and pets and the humane way that it helps people think, it seemed to me to be a good idea, and we dropped it in."

--Thaddeus McCotter (R-MI) in an interview with YouTube's DoggyTV

I really have to hand it to Rep. McCotter, who is likely to face resistance from non-pet owners who will cry unfair advantage. He is taking a brave, unprecedented stand on human-animal relationships and putting his money where his food bowl is. The congressman is clearly (ahem) non-neutered.

On the other hand, owning a pet is an option and, yes, an economic luxury. God knows I'd love to have a horse of my own (and came close a few times) but just can't stomach the $700 per month care and feeding of such an animal. 

I have also had to put off getting a doggie companion until my income stabilizes. And yes, it's pretty awful being without a pet - excruciating, actually. Of course, if I already had a dog, we'd find a way to make it work - like any family in a pinch.

Shhh. You hear that? It's the fair and inevitable question ringing through the air: "Why should non-pet owners be subsidizing pet owners through the taxes they pay?"

And a possible-added-benefit question ringing in my own head: "Might such a tax break encourage people who have thought about adopting a pet to act on it?"


"Providing pet owners the opportunity to deduct pet care expenses is an important step towards ensuring that pet owners provide adequate veterinary and other necessary pet care. It encourages responsible pet ownership and will hopefully reduce the abandonment of pets by people struggling as a result of the economic downturn."

--Pet Industry Joint Advisory Council (PIJAC)

I've read some rumors that the tax break would not be available to all pet owners but only those who make over a certain income. Still, I couldn't find this in the bill brief and have not seen it confirmed anywhere trustworthy.

The bill has been referred to the House Committee on Ways and Means and it will be interesting to see what happens to it. (If you want to actively support the bill, go here or call your local House rep and bark in their ear.)

No matter the outcome, I definitely got a weird thrill reading an official puppy-love acknowledgement in that famously clinical congressional-ese:


SEC. 2. FINDINGS.

      The Congress finds the following:

            (1) According to the 2007-2008 National Pet Owners Survey, 63 percent of United States households own a pet.

            (2) The Human-Animal Bond has been shown to have positive effects upon people's emotional and physical well-being.

Huzzah! The Obvious has finally found its way into the hallowed halls of our nation.  Rick DeBowes, commenting on Washington State University's College of Veterinary Medicine blog, summed it up nicely:


"Interesting, as I have long wondered how long it would take for the human-pet-veterinarian bond to reach into society so far that federal legislation would be forthcoming to support it. The pendulum continues to swing."


***
A fine suggestion from Wenchypoo over at WenchWisdom:


"Maybe a better way to write off animals would be to give a tax credit for every animal adopted from a shelter--that way, it would offset the cost of getting the animal out (spaying/neutering, shots, dental, etc.)

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lorry 5 pts

It's not like people with no pets are supporting people with pets... it's just a tax deduction. This is definitely a good thing. It's not going to make too big of a difference but it's still something. I would bet that it's going t ohave a negative effect on the pet insurance ( http://www.petinsurance.net/ ) industry too. Once pet owners know about the tax break many of them will probably stop their pet plans.

Heather Clisby 5 pts

It all comes down to perspective. I happen to agree that a pet is more of a necessity than a house but I have a feeling we are not the norm.

Also, good point about the vet receipts. It so much more effort to create fake receipts - it's just not worth it. Methinks there are bigger scams out there to be had.

~ClizBiz

BlogHer Contributing Editor, Animal Concerns, Proprietor, ClizBiz ( http://www.clizbiz.blogspot.com/ )

reneesolace 5 pts

I don't really see how people could buy a pet and then use it to get a tax break for medical expenses while abusing and neglecting the animal because they would have to have receipts from a veterinarian that the animal was getting medical care. Unless I missed something important, the tax break is for medical expenses, medical expenses associated with illness, not for just owning the pet and getting it a rabies shot. An example would be coming home from work to find your cat unconscious on the floor and rushing it to the pet emergency center, only to discover that your cat is diabetic and needs to either be euthanized or admitted and treated for diabetic shock. Yes, I recently faced this situation. Yes, I coughed up the money and kitty is still here. Yes, I can see where a lot of people would say I don't deserve a break. But look at all the other nonsense people get breaks for. A tax break on mortgage interest...let me clue you in, a house is a luxury. Poor people live in apartments. I think they are being unfairly penalized. Perhaps they should be given a tax break on a portion of the rent they pay...  And there are tons of breaks out there for people with children. What is earned income credit now, like almost six thousand dollars?  

Heather Clisby 5 pts

Hey Mike,

Thanks for chiming in here to clarify an important difference. For many of us, tax language is full of mystery and confusion.

~ClizBiz

BlogHer Contributing Editor, Animal Concerns, Proprietor, ClizBiz ( http://www.clizbiz.blogspot.com/ )

NCTaxPro 5 pts

Rep McCotter's proposal is for this to be a *deduction*, not a *credit* like the child tax credit. It would be valuable only to people who have sufficient deductions to itemize on Schedule A, and the impact on their taxes would be only a percentage of the $3500 - for example, a married couple in the 25% bracket would see their taxes decrease by $875, if their other itemized deductions totalled at least $11,400.

Heather Clisby 5 pts

Beverly,

Yes, I suspect there will be much head-scratching for all of us going forward on these issues ...

But to your 'complaint' I would have to say that I have seen gradual changes take place just in the last few years. As I mentioned in my post, just seeing the human-animal bond celebrated and acknoledged in cold, sterile, legislative terms gave me great hope.

With regards to the animals left behind after a major disaster, some good did come from Hurricane Katrina. The Pets Evacuation and Transportation Standards Act (PETS) was inspired directly from excruciating situations like that one you described - families being forced to leave behind their beloved pets.

Introduced by Congressman Tom Lantos (D-California) and Christopher Shays (D-Conneticut), PETS requires states seeking FEMA assistance to accommodate pets and service animals in their plans for evacuating residents during natural disasters. PETS was signed into law by President Bush on 10/6/06. 

When it comes to love and compassion, sometimes humans are slow learners but we get there eventually. And yes, it helps to have some furry teachers around the house.

~ClizBiz

BlogHer Contributing Editor, Animal Concerns, Proprietor, ClizBiz ( http://www.clizbiz.blogspot.com/ )

Beverly Flaxington 5 pts

I have to admit that I am reading all of this and scratching my head. I sat night after night reading the horror stories in New Orleans with the people who owned pets and were forced to abandon them because the federal rules said they couldn't be transported. Families, as an example, watched their beloved golden retriever try to swim after the boat rescuing them and watched the dog drown in front of their eyes because there was no where for the dog to go. The "law" prohibited the rescue of pets. So, these families didn't want to leave their pets but were helpless to do anything to save their animals -- and those of us who have them know they are part of the family.

How about if we just started with a legal system that honors animals and a family's right to care for them? I am involved in many rescue groups and have 8 "dumped" pets of my own. I'll care for them with or without a tax break -- doesn't even matter to me. What does matter is having state and federal laws against puppy mills, animal torture and the like. It's amazing how little the general population seems to know, or care about these issues. And how little attention our legislators pay, to these forms of unspeakable cruelty.

So, I guess my "complaint" is that we tend to major on the minors in our government policy sometimes and overlook the basics.....Before a tax law change, maybe we could just work on a bit of compassion and care for these amazing creatures who will forgive and forget how badly they've been treated, in response to a bit of love and kindness.

Beverly Flaxington

Blog: Dealing with Difficult People ( http://dealingdifficultpeople.blogspot.com/ )

Book: Understanding Other People: The Five Secrets ( http://www.understandingotherpeople.com/ )

Heather Clisby 5 pts

Yet another angle I hadn't thought of. The crazy cat lady down the street could write off thousands with her very own pride in the living room. Yeesh.

~ClizBiz

BlogHer Contributing Editor, Animal Concerns, Proprietor, ClizBiz ( http://www.clizbiz.blogspot.com/ )

Heather Clisby 5 pts

Ooooh, good point! I guess I'm just chasing my own tail on that idea ...

~ClizBiz

BlogHer Contributing Editor, Animal Concerns, Proprietor, ClizBiz ( http://www.clizbiz.blogspot.com/ )

InkAndPixelClub 5 pts

I just thought of another unsavory type who could become an unintended beneficiary of this tax break: those people who suffer from a mental illness that compels them to hoard animals as if they were collectable figurines.

I think the congressman's time and energy would be better spent trying to keep people from losing their homes and jobs in the first place rather than trying to help them out with their pet care bills once it happens.

Sara

www.inkandpixelclub.com ( http://www.inkandpixelclub.com )

She Who 5 pts

he wouldn't qualify for the benefit. 

People 'employing" animals aren't permitted to participate.  ;)

http://www.blogher.com/blog/she-who

Heather Clisby 5 pts

Once again, this is the crux of the argument (similar to last week's post ( http://www.blogher.com/free-speech-vs-animal-cruel... )): Are pets as important as children?

Depending on where you stand, the answer is obvious. The final comment on your post ( http://www.aftercancernowwhat.com/2009/08/no-credi... ) from Lilia illustrates one side of that viewpoint, though I would guess she is not in the majority. I do know a few people who love their pets more than their children - sad, but true.

Fact is, the tax system is a human invention - animal have nothing to do with it. As I'd mentioned above in my response to Beth, children will eventually grow up and contribute to the very same system that supported them but until Fido gets a job in an Alpo factory, he will not. Taking emotion out of it and looking at it from a purely logistical fiscal viewpoint, the tax break makes no sense because that money will never come back.

Having said that, I happen to think that animals are far superior to humans, which is why they do not have to have taxes in the first place.

~ClizBiz

BlogHer Contributing Editor, Animal Concerns, Proprietor, ClizBiz ( http://www.clizbiz.blogspot.com/ )

Heather Clisby 5 pts

The logistics involved in supporting such a tax break boggles the mind. And while 63% of Americans legitmately own pets, the break might just lure some unsavory types - those short-sighted folks you referred to - into pet ownership.

Seriously, what happened to the Republicans? They were the tightwad party and you could set your clock by it and now ...? I don't get it either.

~ClizBiz

BlogHer Contributing Editor, Animal Concerns, Proprietor, ClizBiz ( http://www.clizbiz.blogspot.com/ )

aftercancer 5 pts

back in August ( http://www.aftercancernowwhat.com/2009/08/no-credi... )and I am stunned that it is both still out there and that it is being discussed rationally. Don't misunderstand, I love animals, I think they're great, I have some of my own but the comparison between pets and children is a little terrifying to me. There is already a system in place to handle service animals in terms of taxes so let's drop that part of discussion.

Children are necessary for the continuation of a society, hamsters are not. It seems pretty clear to me.

I think if this were to actually come to pass I'd commit tax fraud on principle, that or stop paying them altogether.

Kate

I blog at http://www.aftercancernowwhat.com 

InkAndPixelClub 5 pts

First of all, I love animals.  I have a dog and two house rabbits.  They are very much part of our family and making sure they get the care they need is very much a priority for me.

All that said, I'm not sure that this is a good idea.  I have a huge amount of sympathy for families who have lost a major source of income and are left with no choice but to give up a beloved pet that they could previously afford or provide pet-friendly housing for.  It isn't fair and it breaks my heart.  But I don't know that a tax break for pet care is necessarily the best way to help such people.  it probably isn't going to do a thing for people who can no longer find affordable housing that allows pets.  Though I don't know all of the details, I worry that it would be far too broad of a measure. potentially helping out people who don't need it while doing little to address the underlying issues of why people are having to give up their pets.  

While I would hope that there would be some requirement of proof that you actually own the pet and have paid for the pet care expenses, I do worry about the potential for abuse of this possible tax break.  I have no sympathy for people who adopt pets and do not consider the effort and money that will be needed to care for them.  My worry about Wenchypoo's suggestion is that it would reward people for simply adopting the animal, not for taking care of the animal long term.  My biggest concern is that shortsighted people could see this tax break as the equivalent of a "free puppy," a way to get what they want without having to pay.  When it becomes clear that the tax break isn't just free money, what happens to the pet?  And none of this is even addressing the issue of whether the government can afford such a program right now.

Is it shocking that this Bill is being sponsored by a Republican congressman?  Not really.  The Republican party has ceased to be the "party of fiscal responsibility" and instead become the party of tax cuts to solve every problem under the sun.

Sara

www.inkandpixelclub.com ( http://www.inkandpixelclub.com )

Heather Clisby 5 pts

Well, that's just plain weird. Perhaps he's been bitten by a child? Or a middle-class worker left a mess on his rug.

If Thad is looking to call attention away from the health care bill, this is certainly an odd strategy. Perhaps he is mocking it? Truth be told, I did think it was an Onion story when I first caught the headline.

We shall see.

~ClizBiz

BlogHer Contributing Editor, Animal Concerns, Proprietor, ClizBiz ( http://www.clizbiz.blogspot.com/ )

Heather Clisby 5 pts

Yeah, I thought of this, which means that some evil-minded bastard probably would too. I've heard of this happening with foster kids as well.

To avoid this scenario, purchasing or adopting an animal would require another level of background scrutiny. More paperwork.

~ClizBiz

BlogHer Contributing Editor, Animal Concerns, Proprietor, ClizBiz ( http://www.clizbiz.blogspot.com/ )

Heather Clisby 5 pts

My god, that IS a frightening scenario. Would the IRS have to come to your door to make sure the dog or cat existed? Would this only apply to licensed animals? Probably, since by law you are supposed to register a pet anyway. Still, the administrative and leg-work costs for this would be nightmarish.

Also, just to be clear, the $3,500 number is a maximum, not a standard issue amount. For most people, it would likely be much less.

Funny, I had the same thought - it's not a bill I would expect from a Republican. At all.

~ClizBi

BlogHer Contributing Editor, Animal Concerns, Proprietor, ClizBiz ( http://www.clizbiz.blogspot.com/ )

Heather Clisby 5 pts

Beth,

It's always a sticky line when emotions make their way into legislation. Can relationships be quantified? Expensed? Put into tidy margins? Seems like a difficult thing to measure on paper.

One fiscal argument I can already hear for this is that kids (ideally) grow up to be productive members of society who then give back to the same tax system. Pets will not be doing that.

I think that this bill will ultimately spark a wider debate about man-animal relationships (like the one we've started here) and for that, I'm grateful.

~ClizBiz

BlogHer Contributing Editor, Animal Concerns, Proprietor, ClizBiz ( http://www.clizbiz.blogspot.com/ )

9to5to9 5 pts

Thad McCotter voted last year against broadening health coverage for poor children. He voted against the stimulus plan and its middle-class tax cuts. He was one of the first Republicans to dredge up the now-debunked theory that the president's health care reform would create "death panels" for senior citizens.

But he's concerned about the welfare of pets to the tune of $3,500 a year? I can't wait to see the analysis of the budgetary impact on this one.

I understand Republicans a little less every day.

Debra Legg
9to5to9 ( http://debralegg.com/ )

StephanieSD 5 pts

I'm afraid of all the room for abuse. How many people will run down to a shelter and take the first animal they see, just to neglect it and cash their check? Even if only one person thought they could get away with that, there's one more abused animal.

Stephanie SD

I write about life in Africa at Where in the World Am I? ( http://whereintheworld-stephanie.blogspot.com/ ) and I blog gluten-free at What I Eat ( http://stephaniefood.blogspot.com/ )

She Who 5 pts

The child tax credit is $1000. To get it the child must be a dependent, a citizen, living with you for more than half the year, under 17 and have a social security number. It phases out based on income and the amount of tax owed.

But the cat, gerbil, chicken tax credit is $3,500, and what you need is a receipt from the pet food store? What would it cost just to SPOT CHECK the existence of these pets? Or are we looking at a national registry?

It boggles the mind. Republicans used to stand for smaller government and fiscal conservatism.

http://www.blogher.com/blog/she-who

Beth Terry 5 pts

"Why should non-pet owners be subsidizing pet owners through the taxes they pay?"

Why should those of us who choose not to have children subsidize those who do?  Personally, I'm fine with people getting tax breaks for having kids.  But I'd like a tax break for my kitties.  I'm serious.  I'm NOT saying that children and pets are the same thing.  But as That One Girl says, pets ARE part of the family and help to instill compassion and unconditional love in their caretakers.  I'm all for it.  And I hope my point has been made without offending anyone. 

Beth Terry@fakeplasticfish
www.fakeplasticfish.com ( http://www.fakeplasticfish.com/ )
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