A swift switch in diet can be a tough challenge in the kitchen, but the impact doesn’t stop there. Navigating ingredients can be rough on the brain, but anyone who has been this route knows -it can be just as rough on the budget! Did you know that you could possibly write-off the cost of your increased grocery-spending on your tax return?
In our house, a weekly trip to the grocery store used to cost our family between $200 and $250 (This figure is for a family of 4 with 2 still in diapers.) Post diet changes to make our daily diet gluten-free, casein-free, egg-free, soy-free, sugar-free and chemical-free, my total grocery bill now lands somewhere between $300-$350. That’s a 50% increase some weeks!
Though I see tremendous value in the extra money I now spend, savings are always welcome. Last year, we saw some savings in the form of a tax write-off for these medically necessary diet changes. Could your special diet qualify for tax-credits as well?
If your diet is for medical reasons, there may be a tax write-off available to you. According to the IRS Publication 502 (2011, www.irs.gov) under the “Weight-Loss Program” section, it is stated:
"You can include the cost of special food in medical expenses only if ... 2. The food alleviates or treats an illness, and 3. The need for the food is substantiated by a physician."
It goes on to explain:
"The amount you can include in medical expenses is limited to the amount by which the cost of the special food exceeds the cost of a normal diet."
In other words, if a loaf of gluten-free bread costs $5.00 and a loaf of traditional bread coasts $3.00, you’re claimable expense is not $5.00, it is $2.00.
How do you know if you qualify?
First, for any medical expenses to be written-off, the total medical expenses for the year must exceed 7.5% of your Adjusted Gross Income (AGI). There are numerous spendings that can qualify as “medical expenses”, like mileage to and from doctor’s visits, etc. I encourage you to review Publication 502 for more information.
Second, you would need to meet the above-mentioned criteria for the special food qualifying as a medical expense. It would be advantageous to gather a doctor’s written notice of the medically necessary diet changes. For example: our daughter has very poor liver function and therefore cannot detoxify chemicals or toxins from her body. For this reason it is medically necessary to avoid any food containing chemical additives, food dyes, pesticides, herbicides, etc.
For your reference, here is a list of the cost write-offs (this is just the DIFFERENCE in cost compared to price of “regular” groceries of the same category). We used these when filing in 2011:
Grocery and Cost Over Normal amt. x per yr
Wheat-Free Flour (2.30) $2.3 x 52wks = $119.6
Non-Dairy Milk (1.70 x 2) $3.4 x 52wks = $176.8
Organic - appx. (14) $14 x 52wks = $728
Nitrite Free Meat ( 2 x 2.50) $5 x 52wks = $260
Xanthum Gum (10 x 2) $10 x 2 per yr = $20
Quinoa Pasta (3) $3 x 52wks = $156
Dairy-Free Cheese Shreds (3) $3 x 52wks = $156
Dairy-Free Singles (.5) $0.5 x 52wks = $26
Bread (2.00) $2 x 52wks = $104
TOTAL QUALIFIED FOOD EXPENSE $1746.40
We tried to stay on the conservative side with our grocery items listed, meaning that we chose not to include items like cookies and crackers, or other items that could arguably be “uneccessary” in a daily diet. To put it simply, we stuck to the staples. It is up to you and your tax advisor what will work best for your individual situation.
I am no tax advisor! (Actually, the thought makes me laugh out loud.) Please consult your own trusted tax professional for advice on how to move forward with your medical expense write-off.
Happy, Healthy, TAX-SAVING Eating!!
Kendra Jean Finestead
Greater Tots Organization
139 Olive Street Keller, TX 76248