IRS Faces Legal Challenge: Can Pets Be Tax Dependents?
If the thought of your pet’s yearly vet bills, grooming salon charges, daycare fees, and unique food expenses has ever prompted you to consider them as a dependent, you’re not navigating this alone. One astute lawyer has taken this sentiment to a federal courtroom to potentially change tax policy.
In December 2025, attorney Amanda Reynolds from New York initiated a legal battle against the IRS, petitioning the court to acknowledge her eight-year-old golden retriever, Finnegan, as a legitimate dependent for federal tax purposes.
Despite its seemingly whimsical nature, this case addresses a pressing tax dilemma pondered by many: Are there existing tax deductions for pet expenses? If not, why?
Below we delve into this unique case, unpack the stipulations of tax law, and highlight when the IRS allows animal-related tax deductions.
The Legal Argument: “My Dog Fits the Criteria”
Reynolds asserts in her legal filings that Finnegan satisfies the IRS’s dependent criteria by virtue of:
residing with her 24/7,
lacking personal income, and
her financial support exceeding $5,000 annually, covering his sustenance, medical provisions, and daycare.
A national news piece detailing the legal complaint features Reynolds’s argument: “For practical purposes, Finnegan parallels a daughter and certainly fits the ‘dependent’ label,” in her declaration.
Further, Reynolds is advancing constitutional claims, positing that existing regulations unjustly differentiate between dependents based on “species,” raising Equal Protection issues, and suggesting that the absence of tax recognition constitutes an unconstitutional “taking” under the Fifth Amendment.
Current Progress of the Case
The proceedings are underway in the U.S. District Court for the Eastern District of New York, but developments have been slow.
The discovery stage is currently paused due to a stay granted by a federal magistrate judge, as the IRS compiles a motion to dismiss.
The court order describes this lawsuit as posing a “novel but pressing issue” regarding whether companion animals can be classified as “dependents” under the tax framework. However, the court also acknowledges the significant obstacles the claims appear to face, noting these are “unmeritorious at first sight” and likely to not withstand dismissal motions.
In essence: the case is authentic, in motion, and garnering attention, but the court’s initial perspective suggests a challenging path forward.
Why Federal Tax Law Excludes Pets as Dependents
The fundamental problem for this lawsuit is that tax code recognizes dependents as “individuals.”
Under Internal Revenue Code Section 152, a dependent qualifies as a “qualifying child” or “qualifying relative,” but the term “individual” has traditionally denoted a human entity.
This is why IRS paperwork does not provide an option for adding a pet as a dependent. Dependents require Social Security Numbers or taxpayer identification numbers, and related credits and deductions are constructed around human familial and household relationships.
Thus, while Reynolds argues that Finnegan meets the functional dependent criteria (residency and financial support), the tax system does not categorize animals as dependent “individuals.”
Existing Tax Benefits for Pet Owners
Although routine pet expenses are generally nondeductible, there are exceptions worth noting for tax planning strategies.
1) Service animals can qualify for medical expense deductions
If an animal is a trained service companion assisting someone with a disability, associated expenses may qualify as medical costs when itemized.
The IRS clarifies that deductible medical expenses must surpass the applicable AGI threshold. In this context, expenses related to acquiring and maintaining a service animal may qualify when linked to medical care.
Important Distinction: Emotional support animals typically do not meet the federal criteria for service animals; service animals are specifically trained for disability-related tasks.
2) Business animals may be considered a business expense
Animals involved in legitimate business functions—such as a:
guard dog protecting a business property, or
animals employed for pest management purposes in a commercial setting.
In these cases, maintenance costs might be valid business expenses, but must be well-documented with relevant business justification.
3) Fostering animals aligns with charitable deductions
Taxpayers fostering animals on behalf of qualifying nonprofits might be eligible to deduct certain unreimbursed expenses as charitable donations, adhering to strict guidelines and record-keeping.
Implications for Taxpayers
Many can relate emotionally to this lawsuit: pets occupy a familial role for many, and their upkeep costs are genuine. However, tax law is built on precise definitions, not feelings.
Currently:
Pets cannot be filed as dependents on federal tax returns.
Routine pet expenses like food, grooming, and vet visits remain personal expenditures, and thus nondeductible.
Some animal-related expenses qualify under specific conditions such as service animals, particular business-related, and fostering charitable deductions.
The outcome of Reynolds's litigation is worth watching—not because experts expect changes to IRS policy soon, but for the spotlight it puts on how tax codes still draw sharp lines between "family" and "property," despite evolving household dynamics.
Finally, it serves as a reminder: always verify what the IRS recognizes for deductions to avoid assumptions based purely on sentiment.
Want tax & accounting tips and insights?
Sign up for our newsletter.