IRS: No Deduction For Spiffy Duds!

So you think the fact that you spend some big bucks on the clothes you wear to work – in order to impress your customers and others – is reason enough to have Uncle Sam subsidize your expenditure.

Not so, say the Revenooers, as most recently expressed in the Tax Court case of Sofien Beltifa.  This guy was employed by a restaurant in New York City in 2011 as a bartender/manager.  His duties included “calling in” liquor orders, taking liquor deliveries, and ensuring that the bar was fully stocked at all times.  The restaurant did not require its employees to wear a uniform, though it did request employees to wear an all black ensemble (shirt, tie, pants) while working.  The taxpayer believed it was necessary to look his best because he was one of the faces of the restaurant.  “When you enter, you just see me and then you walk through,” he testified.  “You see the host, you see me.  I’ve got to look presentable.”

He thus wore high quality clothes while tending bar and spent a substantial amount for cleaning the clothes he wore.  Those clothes, however, could also be worn for general purposes outside of work, which is where his tax deduction idea got shot down.

In so finding, the Court noted that with respect to the deduction claimed for clothing expenses, “We are mindful that he was not required by his employer to wear any particular type of clothing, and the clothing he did wear was of a kind adaptable generally to wear away from work as well as at work.”

Bottom line:  the taxpayer’s clothing costs were his personal expenses and not deductible.

And here comes the IRS, again, warning taxpayers of the increasingly frequent occurrences of malware and phishing schemes right in the midst of this year’s tax season.  Revenooers recently renewed a consumer alert for e-mail schemes after seeing an approximate 400 percent surge in phishing and malware incidents so far this season!

“This dramatic jump in these scams comes at the busiest time of tax season,” quoth IRS Commish in recent weeks.  “Watch out for fraudsters slipping these official-looking emails into inboxes, trying to confuse people at the very time they work on their taxes.  We urge people not to click on these emails.”

If you do, you may be taken to one or another site designed to imitate an official-looking website, such as IRS.gov.  These sites ask for Social Security numbers and other personal info, and may carry malware, which can infect your computer and allow the bad guys to access your files or track your keystrokes to gain information on you.  If you receive an unsolicited email that appears to be from either the IRS or an organization closely linked to IRS, report it by forwarding it to www.phishing@irs.gov.

And recall, as we have noted before, that IRS does not initiate contact with taxpayers by email to request personal or financial information.

And finally this week comes some particulars from The Donald (about time, right?) regarding his healthcare proposals to supplant the fiasco known as Obamacare:  allowing prescription drugs to be imported, and the sale of health insurance plans across state lines.  All in the interest of lowering costs.  We shall see.

CONSULT YOUR TAX ADVISOR – This article contains general information about various tax matters.  You should consult your CPA regarding the implications to your particular situation.

Jeff Quinn, the author of this article, is a CPA, recently retired from the firm of Ashley Quinn, CPAs and Consultants, Ltd., with offices in Incline Village and Reno.  He welcomes comments at jquinn@ashleyquinncpas.com.