Remediation of a house where devil worship occurred

[James McGovern]

I ran across a property that I can acquire cheap where devil worship occurred. . Can I legally deduct the costs of a bandit, priest and imam to eliminate demons?

[Dylan Brown]

Who would have thought I would be talking religion in a tax form on BiggerPockets this morning!  I should be able to give some advice on both the spiritual side as well as the tax side:)

I can't speak to a pandit or imam, but I know in the case of a Catholic priest they will not actually charge you anything, so deductibility is not going to be an issue.

A priest is at the service of his people and will perform a blessing on a home at no cost.  A free-will donation is usually appreciated and I would recommend that since they are taking the time.  But as a donation, that would be deductible as a charitable deduction if you itemize, but it would not be a business expense.  A deacon can carry this out as well if the priest is not available.

If the problem is more severe, you may also consider a "minor exorcism" or "Deliverance Prayer" - but those would be free as well and are performed by a priest with the permission of the local bishop.

If the problem is VERY severe and you have proven true demonic presence (extremely rare and usually vetted very thoroughly) a priest may determine that a true exorcism is needed (Solemn Right of Exorcism) at which point they would call in the bishop and an ordained priest that is the "diocesan exorcist", with explicit bishop approval to conduct formal exorcisms.  This is not taken lightly and can incur a significant travel expense for the church if they need to bring in a specialist, but they still would not charge you for it since the church is not allowed to charge for any of its services (cf. Simony, Catechism ¶2121).  Of course, if you find yourself in this situation, it would probably be smart to do a generous free-will donation to help with the cost and that would be also deductible as a charitable contribution assuming you itemize your taxes (but of course this is by no means mandatory or expected and should be based on your means).

Now, lets say one of the other rituals from other religions does cost money (I don't know anything about them so I am not sure).  Here is the breakdown of what to do with those costs:

Religious services, such as exorcisms or blessings, are considered personal and spiritual in nature rather than ordinary and necessary business expenses under IRC §162. The IRS does not recognize demon remediation as a legitimate business activity tied to producing income (mainly because it is not "ordinary and necessary" nor is it "customary" of landlords to carry out). Payments to priests or religious figures are generally donations, not service fees, and are only deductible under §170 if made to a qualified 501(c)(3) and not in exchange for a personal benefit. Since the purpose is spiritual purification rather than economic utility, the expense fails both the ordinary and necessary tests for deductibility.

Therefore, it is not a business deduction on your Schedule E, but if you make a donation to a qualified church or religious organization, it may be deductible as a charitable contribution on Schedule A if you itemize.  You can't do either if they are actually charging you a specific fee for the service, but if you are not obligated to pay anything but you make a donation, that is what could be deducted on your Sch. A as a charitable deduction.

Hope that helps!