Guard Dog Expenses for Pawn Shop

[criver]

I own a pawn shop where we had an attack by armed robbers. We now have a pit bull as a guard dog. The dog remains at the shop 24 hrs a day. Signs are posted. I just recently learned the expenses for this could be deductible as a business expense.  Expenses were paid personally. I would like to deduct these as a non-reimbursed business expenses on my personal return. The business is an S-Corp. I am 50% shareholder. I'm working on the 2017 personal return. The business return has already been filed.

Am I correct that these expenses could be tax-deductible? What kind of limitations may be on the expenses? Where do I list these?

[Carl]

If you claim it on the personal tax return, then it's subject to the 2% AGI limit and chances are extremely high it would trigger an audit. I fully expect the IRS would disallow it on your personal return too. You'd be better off amending the corporate return and it's no problem to claim it there. Now if you purchased the dog, what you paid for the animal is depreciated over 7 years. But your "maintenance cost" of the dog (food, shelter, shots, vet visits, etc.) would be deductible as an expense on the corporate return.