TAXES: Did you get your allergen-free deductions?
The Scoop
Tax day is 10 days away, and I'm hearing that many allergen-free folks are not aware that there is a tax deduction available for gluten-free and other allergen-free foods. But of course, the IRS has some rules. Speak to your accountant and find out if you can add these deductions to your itemized medical expenses for 2010. And start keeping track of your food in 2011, it could pay off, especially if your medical expenses are already on the high side. For more specific information, ask your accountatnt and go to the National Foundation for Celiac Awareness web site. Its a great resourse.
The Short List
- A Doctor's Note that confirms that you have either celiac disease, or a food allergy that will be with you for life. Attach the letter from your doctor to your tax return.
- This is a medical deduction, so use Schedule 1040A. Find out from your accountant if you qualify and if this receipt gathering exercise is worth the work. You may need to meet a minimum prior to being able to claim the deduction.
- Claim only the extra cost for the allergen-free food that you purchase as a replacement food. This means that you can deduct the difference between, for instance a normal loaf of bread costs and a gluten-free loaf. You will have to do some comparison shopping and calculating. Be sure to include all of the flours, milks, and stuff marked "gluten-, dairy-, nut- . . . free", etc.
- Claim full cost of things like Xanthum Gum, an item that is only used in allergen-free cooking.
- Mileage, postage and shipping costs can also be deducted if it is a special trip to the health food store, so keep track!
If you need to refer to IRS documentation for your accountant or agent, here is the appropriate citation:
- IRS Publication 502
- Revenue Rulings: 55-261, 76-80, 2002-19 and 67 TC 481
- Cohen 38 TC 387
- Flemming TC MEMO 1980 583
- Van Kalb TC MEMO 1978 366
Get Organized
Keep copies of every note, document and receipt. The best way to keep track is to scan your receipts so the ink doesn't wear off. There are some really cool receipt scanners out there right now. Neatco.com has a Neat Receipt and Neat Document scanner one of which will be on my "to-purchase" list next month.