Business expense

[shoover]

I have a client that works a full time job and has a lawn care business. He has a DUI conviction. In order to continue to drive for his work and business he had a breathalyzer installed in his vehicle. He also has cost for monitoring. Are these legitimate business deduction?

[dascpa]

I don't have a fact answer but to me that's like saying I got a speeding ticket on my way to a lawncare job and it should be a business expense.  Nope.

[Skylane · Accepted solution]

 non deductible expenses include civil or criminal fines or penalties. 

https://www.govinfo.gov/content/pkg/USCODE-2011-title26/pdf/USCODE-2011-title26-subtitleA-chap1-subc...

(f) Fines and penalties
No deduction shall be allowed under subsection (a) for any fine or similar penalty paid
to a government for the violation of any law.

[IRonMaN]

I once had an electrician trying to deduct lasik eye surgery.  He was told that it wasn't a deductible business expense.  His response was that he should be able to deduct it through his corporation because he needed to see to do his job.  The moral of the story is - you can justify anything if you try hard enough........... but that still doesn't make it deductible.

[TaxGuyBill]

I think I disagree with the other answers.  I don't see why it can't be a vehicle expense (if they use Actual Expenses).

This isn't a fine or penalty to the government for doing something illegal.  It is a fee to maintain their legality to drive.

[IRonMaN]

If he didn't get a DUI he wouldn't have needed to install the equipment.  As part of his penalty for the DUI he needed to install it in order to keep driving.  

[BobKamman]

Here's the answer.  Tell him to consult with a tax professional

Your tax professional may tell you that when it comes to IIDs, commonly required for individuals with drunk driving convictions, in most cases for 2024 these expenses are not tax-deductible for personal use. The Internal Revenue Service (IRS) generally considers IIDs as personal expenses rather than deductible business expenses.

However, there can be exceptions. Be sure to ask your tax professional if you are an individual who demonstrates a legitimate business reason for requiring an IID, such as for a company vehicle or as part of employment conditions. If so, the expense may qualify as a deductible business expense. It's important to consult with a tax professional to ensure you are complying with IRS guidelines.

https://www.breatheeasyins.com/knowledge-center/are-ignition-interlock-devices-tax-deductible-in-202...

[TaxGuyBill]

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@IRonMaN wrote:

As part of his penalty for the DUI he needed to install it in order to keep driving.  

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But is isn't part of the penalty.  It is a voluntary amount paid to reinstate a privilege so they don't break the law.

For that matter, as far as I can tell, it isn't even a payment to the government; it is paying a third-party.

[BobKamman]

What if he hired a driver to take him to work, instead?  Would that be a penalty?

What if he stopped at AA meetings on the way to or from work?  Pub 502 tells us,

You can also include in medical expenses amounts you pay for transportation to and from alcohol recovery support organization (for example, Alcoholics Anonymous) meetings in your community if the attendance is pursuant to competent medical advice that membership in the alcohol recovery support organization is necessary for the treatment of a disease involving the excessive use of alcohol.

[rcooley25]

The penalty was not tough enough. He should be cut off from fire ball for 2 years or more.

[IRonMaN]

Two years would be pretty difficult for you.  If a judge was thinking about sentencing you to that, I'm guessing you would prefer the death penalty rather than suffer through 2 years without Fireball.