Looking Your Best May Not Be Tax Deductible
Former Central Ohio television news anchor, Anietra Hamper, lost her deduction for business clothing in tax court (Hamper, TC Summ. Op. 2011-17). The tax court ruled that regardless of her wearing certain attire only on TV, such items were not consistent with the definition of ordinary and necessary use for business the services uses for what is an allowable deduction. Hamper claimed her employer required her to maintain a professional appearance and to keep abreast of breaking news events as good reason for the deduction.
Very few people actually have the luxury of deducting clothing as a work expense. If you work in a general office environment, you will likely not be able to reap the benefits of a work clothing deduction. Suits and dresses, regardless of whether you are a TV personality, a national presenter, or at the accounting office, cannot be deducted from your taxes because you could conceivably wear them elsewhere. IRS Revenue Ruling 70-474 provides the criteria that need to be met in order for clothing to be deductible as ordinary and necessary business expense under Code Section 162:
- specifically required as a condition of employment,
- unsuitable for general wear, and
- not worn for personal use.
The costs of business attire is not deductible even if a taxpayer establishes that he would not have purchased the items but for employment.
Examples of what are likely deductible would be:
- Professional athletes uniforms
- Firefighters and police and military, if prohibited from wearing off duty
- Stage costumes that are not appropriate for street attire
- Company logo apparel or other clothing designed strictly for the workplace
Anietra Hamper’s lawyers argued the expenses where part of her doing her very public job. She argued that the purchases were a career necessity and a means of maintaining “a neat, professional, and conservative appearance, and as a part of her community appearances.” In the end she was denied most of her claims for unreimbursed business expenses and hit with accuracy-related penalties for failure to keep adequate contemporaneous records showing the amount and keeping adequate contemporaneous records showing the business purpose of expenses.
The take-a-way lesson here is, the “Victoria Secret” look is not entirely tax deductible and the argument for keeping good records is not going to go away.
