Can treatment for Celiac Disease be a tax deduction? According to my research, it appears that Celiac treatment can in fact be a tax deduction, under the condition that you have been officially diagnosed with Celiac Disease.
Here are the guidelines I’ve tracked down:
The following guidelines were received from the Oct. 1993 CSA/USA National Conference in Buffalo, NY:
- You can claim only the EXTRA COST of the gluten-free product over what you would pay for a similar item at a grocery store. For example, if wheat flour costs $0.89 per 5 lbs. and rice flour is $3.25 per 5 lbs., the DIFFERENCE of $2.36 is tax deductible. You may also claim mileage expense for the extra trip to the health food store and postal costs on gluten-free products ordered by mail.
- The cost of xanthan gum (methylcellulose, etc.) used in gluten-free home baked goods is completely different than anything used in an ordinary recipe, so in the opinion of the IRS, the total cost of this item can be claimed.
- Save all cash register tapes, receipts, and canceled checks to substantiate your gluten-free purchases. You will need to prepare a list of grocery store prices to arrive at the differences in costs. You need not submit it with your return, but do retain it.
- Attach a letter from your doctor to your tax return. This letter should state that you have Celiac Sprue disease and must adhere to a totally gluten-free diet for life.
- Under MEDICAL DEDUCTIONS list as Extra cost of a gluten-free diet the total amount of your extra expenses. You do not need to itemize these expenses.
Suggestions:
- You may want to write the Citations (as given below) on your tax return. Always keep a copy of your doctors letter for your own records.
- Your IRS office may refer you to Publication 17 and tell you these deductions are not permissible. IRS representatives have ruled otherwise and this is applicable throughout the US Refer them to the following Citations:
- Revenue Ruling 55-261
- Cohen 38 TC 387
- Revenue Ruling 76-80, 67 TC 481
- Flemming TC MEMO 1980 583
- Van Kalb TC MEMO 1978 366
Note: I would recommend reviewing any potential deductions with your personal accountant.
Zach says
Kyle,
You cannot start deducting the incremental cost until those costs exceed 7.5% of your adjusted gross income. For example, if you make $100,000 per year AGI, you’d have to spend $7,500 BEFORE you could deduct.
In studying this over the last few months, my incremental grocery bill (before i was GF compared to after) is about $400 – $500 per month. This over 12 months is $4,800 – $6,000 per year incremental (estimate). In the above AGI example, it wouldnt make sense to go through the difficulty of keeping receipts unless you had a much lower AGI. Thoughts?
Kyle Eslick says
Zach,
I’m not really sure, hence the research done above.
That said, I follow your logic and agree. It truly depends on the AGI and your situation. Some people don’t get much benefits on tax deductions because they don’t pay much in taxes, so it really boils down to your income, your situation, etc.
If I had to guess, the tax deductions for Celiac treatment is probably mostly ideal for a gluten free household, or for multiple people who are diagnosed with Celiac Disease.
Linda says
Yes, it is true that when you are itemizing your taxes, that all medical expenses once added togehter then have 7.5% of your adjusted gross income deducted from that.
However, remember that your insurance premiums, your medical co-pays, your milage for medical appts are all included too. I itemized my taxes for the first time this year. It was due to high medical costs vs low income on disability retirement. For myself, even after taking the 7.5% off, my medical expenses for my son and myself were still about $10,000.
I do not own a home or have any other items that I could itemize. For, me it is worth saving the recipts throughout the year and seeing what happens later. While I did calculate down to the penny for milage to my medical appts, I did not do the same for our GF food expenses. I estimated the EXTRA costs to be $100 per month. I do have the reciepts to back it up if I am audited. I just did not have the energy to total every GF food purchase vs non-GF equivalant.
When I was working, however, I used my Medical Flexible Spending pre-tax money for my GF food expenses. It was much easier to look up one or two food items at a time. I kept a running list [with on-line documentation printed out] of the typical costs for items I purchased. I then turned in my recipts to my FSA company with the “typical” non-gf expenses for similar items. For example, non-Gf frozen pizza often goes on sale for 99 cents vs the $6.99 I paid for Amy’s. A loaf a bread, also compared 99 cents to whatever cost I had that time. It was well worth the time spent.
Right now, I just throw all my food recipts in a file and keep them for the taxes. Maybe now that I know I have had enough medical expenses this year, maybe I will calculate as I go for the GF vs non-GF foods. Last year, I kept recipts for medical items, such as prescribed supplements and circled/boxed the items on the reciepts and totaled those expenses as I went.
When you factor in your insurance premiums, most of us will hit the 7.5% on that expense alone …. it can’t hurt to save the reciepts and keep track of the expenses. Maybe it will also nudge you into baking your own breads and goodies once you see how much you are actually spending too 🙂
Scioto Celiac says
Since we have had medical expenses over the 7.5% the last 2 years, I am now saving receipts for GF foods and keeping track on a spreadsheet for my 2009 taxes. I’m kind of hung up on how to compare and document costs between GF and non-GF foods. I thought they should be compared oz for oz on each item and then calculate the difference in cost as opposed to box for box, etc. Does anyone have any thoughts on how to calculate this?