Tax Thursdays: Is Your Dog tax-deductible?

It's Thursday! Let's talk TAXES… 

Trump (investment) accounts are a new type of tax-advantaged account for young children that will launch next year. If you’re a parent of a kid under 18 years of age (SS # required) you can elect to open and activate a Trump account. You’ll need to either file a new Form 4547 or sign-up through an online government portal that will be ready in mid-2026. The U.S. government will contribute $1,000 to each Trump account set up for children born between 2025 and 2028.

Up to $5,000 of additional money can be put in the account each year by parents or any other person until the child reaches age 18. Parents or relatives of a kid, won’t be able to deduct their contributions to Trump accounts, however.

Kids who open this tax-advantaged account, will not be taxed until they start taking distributions when they turn 18. The distribution rules are similar to those of traditional IRAs. Eventually, a Trump account may be rolled over to a traditional IRA for the same beneficiary.

As 2025 comes to a close, Democrats and Republicans have been unable to reach an agreement on how to make healthcare more affordable for their constituents in 2026. Obamacare subsidies – also known as Premium tax credits (PTC) – are set to expire on December 31^st. Consequently, fewer Americans will be eligible for the PTCs, or the credit will be significantly reduced, rendering health insurance unaffordable for many.

While an agreement could still be reached in early 2026, individuals currently looking for marketplace coverage for 2026 will find that they no longer qualify for the premium tax credits (PTC).

Political gridlock hasn't kept lawmakers from exploring innovative solutions for healthcare affordability. Senator Josh Hawley (R) of Missouri introduced a new bill allowing non-itemizers to deduct up to $25,000 of their medical expenses, removing the current 7.5% adjusted gross income (AGI) threshold. If Congress takes this proposal seriously, it could represent a Massive (not Big) Beautiful Tax Cut for millions of Americans. TBC…

A dog may be man’s best friend, but dogs are neither a qualifying child nor a qualifying relative, according to the IRS. That means that you can’t claim your household pet as a dependent on your tax return. A proud dog-owner in New York recently filed a lawsuit against the U.S. on behalf of herself and her dog, Finnegan. She argues that domestic companion animals should be recognized as dependents under the tax code. The case is currently in the discovery process of litigation, but it will likely fail on the merits...  "Hhhhuuufff " (heavy dog sigh).