Front Tooth Dental Implant as Sch C expense?

[SFA]

Client is a professional who must conduct face-to-face meetings and provide telephone consultations. Client broke off a front tooth and could not speak clearly (lisp and whistle sounds) so immediately had tooth replaced. Now is asking if this is a business deduction because the missing tooth created a physical barrier to him performing his profession. He believes the impediment and cosmetic appearance created embarrassment and affected his ability to do his work and his clients were put-off by the sound of his voice and his appearance. 

 

The client is really pressing me on this. If this is a "repair and maintenance" expense, must we apply the BRA test (betterment, restoration or adaptation)? Joking, but not sure exactly what to give the client to satisfy him about whether this is a Sch A and (I believe) not a Sch C deduction.

 

[Terry D EA]

I don't this is an expense from the normal course of business. I agree with you it is a Sch A deduction and not a C. It will be interesting to see what others have to say about this.

[Pacun]

Cosmetic to me and most likely not deductible at all with the 10% floor.

[rfassett]

Ask him if he kept a log as to how much time he spent actually performing his job after the implant vs how much time he actually spent NOT performing his job after the implant - you know, the personal use issue.  My guess, the personal use will be well over 75% and still recognizing implants are pricey, I doubt if you have much of a deduction for the business.   That is assuming he kept a log.  Now, all that said, I am mostly joking, but I would swing the bat in an audit and see if I could make the ball fly. 

[Pacun]

I know you were mainly joking but I like the fact that the client wants to treat it as a tool for his job. So, you are correct, when tools are used by both personal and business use, you have to prorate it.

[SFA]

Isn't there a breast implant case that sets a precedent here?

[Lion EA]

Maybe if it were a removable crown that he took off when not at work....  Or, as SFA says, breasts too big to fit in her street clothes.  Maybe he needs a crown with his business logo inlaid in diamonds!

[SFA]

No really, there is a business deduction/breast implant case that went to tax court and the IRS lost. I just don't have the reference material at my fingertips just now.

Edited March 20, 2015 by SFA

[Lion EA]

Yes, her implants were abnormally large to increase her tips and she swore she was going to have them removed when she quit working!  So, if has an abnormally large implant to increase the attention he draws in face-to-face meetings....

[Max W]

Here is a link to the big breast case.

http://www.huffingtonpost.com/julian-block/tax-court-upholds-busines_b_5292707.html

 

The judge may have had a little female bias.  In any event, the circumstances are far different than the 

broken tooth.

[jklcpa]

I would not take a deduction for this on Sch C, and would consider it a medical deduction if it was more than cosmetic in nature. In other words, if the root was so damaged that the tooth could not be repaired by post and crown work, then deduct the implant, otherwise it seems cosmetic to me if the extra amount was spent for looks over the same look that could be achieved by lesser priced work.  Either way, it's possible that the Sch A deductions may not exceed 10% of the AGI, so this may end up to be not an issue unless the taxpayer has other large medical expenses +/or pays his own medical premiums.

[SFA]

Yowza, I can't even imagine the burden of proof that one took to defend. Thank you for this reference site. I would like to forward it to my client but do not want to "belittle" their point of view. I will search for something a little less humorous.

[mrichman333]

Isn't there a breast implant case that sets a precedent here?

 

http://articles.orlandosentinel.com/1994-07-24/business/9407210044_1_hess-exotic-dancer-implants

 

Tax Court Approves Breast-implant Surgery Deduction For Exotic Dancer

[MsTabbyKats]

If he were a voice-over, or broadcaster, or actor....would you give it to him?

 

I don't see much of a difference.  His voice is his living.

 

I would tell him to document the lisp.  I'd classify it as "professional maintenance".

[jklcpa]

If he were a voice-over, or broadcaster, or actor....would you give it to him?

 

I don't see much of a difference.  His voice is his living.

 

I would tell him to document the lisp.  I'd classify it as "professional maintenance".

 

The difference is that SFA's client had a broken front tooth and would have (hopefully) had it repaired anyway, so it really isn't ordinary or necessary specific only to his job.  It's also different than the breast implant case because it is fairly common in the pole dancer or stripper industry to have implants, for for those that earn higher revenues, her boss suggested it for exactly that purpose, and she would have removed them during off hours if she could have. Having size 56N breasts that weigh 10 lbs each and look like a deformity compared to the average woman is vastly different than have a cosmetic procedure to repair a tooth to make it look normal.

 

SFA, can you be a little more descriptive of your client's line of work?  What type of "professional" is he?

[SFA]

Attorney

[kcjenkins]

Isn't there a breast implant case that sets a precedent here?

Yes, the Hess case.  But remember that one reason she won in Tax Court was that the extreme degree of those implants made the Judge agree that they were NOT a personal benefit.  She went under the knife twice, that enlarged her bust size -- first to 56FF and then to 56N. (No, those numbers aren't misprints.)

 

The IRS contended that the Tax Court should characterize the outlays as nondeductible personal expenses.  Get real, responded Special Trial Judge Joan Seitz Pate, who reasoned that for someone like Cynthia, top-heavy breasts are business assets and implants are a necessary "stage prop." Hence, no personal benefit derived by Cynthia from those particular implants, which, Judge Pate pointedly noted, aren't the type usually sought by women seeking to enhance their personal appearance. Instead, it was Cynthia's financial desires that motivated the dancer to undergo the surgery.

 

Cynthia helped her case by testifying that because she and her husband routinely endured off-color, vituperative comments from people they encountered, she had decided to have the implants permanently removed when her exotic-dancing career ended. This bolstered her contention that the surgery was just for business purposes.  The judge compared the implants to work clothes and uniforms, which are allowable only if they satisfy a two-step test: (1) required as a condition of employment and (2) unsuitable for everyday use. It was a cinch for Cynthia to get over the first hurdle; her large, cumbersome breasts are a "costume," needed to retain her employment as a professional exotic dancer.

 

As for the second stipulation, the court cited Cynthia's testimony that she would remove the implants each day, were that possible. As they cause bacterial infections and other serious medical problems, her understandable preference would be not to "wear" them while offstage. The decision was that implants so extraordinarily large are "useful only in her business" and, therefore, deductible.

[Jack from Ohio]

I cannot believe how much discussion is on this thread.  Schedule A, just like all dental work.  Any request by the client to add it to Schedule C should be met with some kind of statement pointing out the outright fraudulent nature of that request.

 

Is the client really ready to spend thousands of dollars to preserve a $1K "business deduction?"  To keep it, he would probably have to end up in tax court.

 

However, SFA did say the client was an attorney, so maybe my last statement may not be too far fetched...

[jklcpa]

The cost of implants is more than double that, more like $2,000-$2,500 per tooth.  Anyway, if it was for restoration, it would be deductible on Sch A, but cosmetic dentistry is nondeductible.

[Jack from Ohio]

The cost of implants is more than double that, more like $2,000-$2,500 per tooth.  Anyway, if it was for restoration, it would be deductible on Sch A, but cosmetic dentistry is nondeductible.

I have teeth that have been "replaced" with a crown.  Either way, my point is still valid.

[easytax]

The cost of implants is more than double that, more like $2,000-$2,500 per tooth.  Anyway, if it was for restoration, it would be deductible on Sch A, but cosmetic dentistry is nondeductible.

Just an FYI --- There is a newer 'implant" that actually screws onto a stub drilled and mounted into the bone of the jaw --- one client had this done last year at a cost of $9,900 for all preparation, etc. and the apparatus, etc.   So they can be expensive.

 

All was fine but complications with an infection added another $1,300 to the procedure.  Total time from original tooth needed to finally done and all well --- just over 13 months.

[jklcpa]

Just an FYI --- There is a newer 'implant" that actually screws onto a stub drilled and mounted into the bone of the jaw --- one client had this done last year at a cost of $9,900 for all preparation, etc. and the apparatus, etc.   So they can be expensive.

 

All was fine but complications with an infection added another $1,300 to the procedure.  Total time from original tooth needed to finally done and all well --- just over 13 months.

 

 

Ouch!!!!  Literally and figuratively. 

[Pacun]

I read somewhere that the IRS treats dental work not as cosmetic but as a medical condition and it can be deducted on Sch A without much issues. So, I would deduct any dental work on Sch A, but it will be hard for me to include it on Sch C.

 

Of course now with the 10% limitation, that means nothing or a few bucks of benefits.

[SFA]

Thank you everyone for checking in on this topic. The return was ready for pickup prior to him pressing me to make a change. I said I would do additional research before he picks up. Schedule A is where it stays. I guess I just needed a little backbone support.

[FreedomTaxed]

IRS Pub 334, Chapter 8, outlines how to decide if an expense can be deducted from business revenue. In general, you can deduct "[r]epairs that keep your property in a normal efficient operating condition". But you also can't deduct "[p]ersonal, living, and family expenses". This is a gray area.

 

You have to ultimately fall back upon the issue of not taking an unreasonable position. To wit, you know that adding a medical expense to the Schedule C is unreasonable, because an IRS auditor is likely to conclude that you can still talk and make an appearance in business, regardless of tooth damage.