The American Rescue Plan, a $1.9 trillion economic stimulus package, includes a provision that would create a tax credit for pet expenses. The credit would be available to taxpayers who itemize their deductions and would allow them to deduct up to $2,500 in qualified pet expenses. This includes things like veterinary care, pet food, and pet supplies.

Did Biden Approve a Pet Tax Credit?

Who is eligible for the pet tax credit?

The pet tax credit is available to taxpayers who itemize their deductions. This means that you must have enough other deductible expenses to make it worthwhile to itemize. The standard deduction for 2021 is $12,550 for single filers and $25,100 for married couples filing jointly. If your total itemized deductions are less than these amounts, then you will not be able to claim the pet tax credit.

What expenses are eligible for the pet tax credit?

The pet tax credit is available for expenses that are "ordinary and necessary" for the care and maintenance of your pet. This includes:

  • Veterinary care, including exams, vaccinations, and surgery
  • Pet food and treats
  • Pet supplies, such as collars, leashes, and toys
  • Pet grooming
  • Pet boarding and daycare

The credit is not available for expenses that are considered personal, such as the cost of pet clothing or pet jewelry.

How much is the pet tax credit?

The pet tax credit is equal to 20% of your qualified pet expenses, up to a maximum credit of $2,500. This means that the most you can save on your taxes with the pet tax credit is $500.

When can I claim the pet tax credit?

The pet tax credit is available for tax years beginning after December 31, 2021. This means that you can first claim the credit on your 2022 tax return.

Conclusion

The pet tax credit is a valuable tax break for pet owners. It can help you offset the cost of caring for your pet and save you money on your taxes. If you itemize your deductions, you should consider claiming the pet tax credit on your next tax return.