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Tax Court Upholds Business-Expense Deduction for Topless Dancer's Breast Implants

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Just because you incur expenses for business reasons doesn't mean that they automatically qualify as deductible. The Internal Revenue Code stipulates that these outlays must be "ordinary and necessary" in relation to your business.

The operative word is business. Generally, what you spend to improve your appearance, general health or sense of well-being, are nondeductible personal expenses. When there's a thin line between business and personal, the courts have to step in.

Take the case of Cynthia Hess, known as "Chesty Love" in her show biz endeavors as an exotic dancer. The Hoosier hoofer persuaded the U.S. Tax Court to uphold a deduction for surgical implants to enlarge her breasts.

Cynthia, aka as "Tonda Marie," launched her topless career on the night club circuit. She was able to get gigs. But because of a hereditary deficiency, she had to settle for smaller earnings than other, better-endowed ecdysiasts (a fancy word for "stripper). So Cynthia's agent persuaded a willing client to undergo surgery that enlarged her bust size -- first to 56FF and then to 56N. (No, those numbers aren't misprints.)

With these stats and the new stage name of "Chesty Love," she resumed performing and immediately experienced an uplift in earnings, an increase that was unquestionably fueled by chats with talk-show hosts, such as Sally Jesse Raphael and the celebrated chest connoisseur, Howard Stern.

Cynthia's career-enhancing move notwithstanding, her implant deduction fell flat with bluenose bureaucrats. 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.

Post-decision publicity included an appearance on the Jerry Springer show. Cynthia told the audience that "My salary as a dancer went up in direct proportion to the size of my chest." To view the interview, go to You Tube's "Chesty Love on the Jerry Springer show."

Julian Block writes and practices law in Larchmont, N.Y. and was formerly with the IRS as a special agent (criminal investigator) and an attorney. He is frequently quoted in the New York Times, the Wall Street Journal, and the Washington Post, and has been cited as: "a leading tax professional" (New York Times); "an accomplished writer on taxes" (Wall Street Journal); and "an authority on tax planning" (Financial Planning Magazine). This article is excerpted from "Julian Block's Year Round Tax Savings," available at julianblocktaxexpert.com.