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Medical expense deduction for weight-loss program

IRS recently issued new rules that make it easier to deduct the cost of a weight-loss program. This presents an opportunity for tax savings, and in some cases a tax refund, for those who participate in such programs.

A weight-loss program is a deductible medical expense only if you participate in the program as treatment for a specific disease diagnosed by a physician. If you undertake the program to improve your general health, rather than to alleviate a specific ailment, the costs aren’t deductible. Therefore, it’s a good idea to get a written diagnosis from your doctor before starting the program.

IRS now recognizes that obesity is a disease in its own right. Therefore, if your doctor diagnoses obesity, you will be able to deduct the cost of a weight-loss program. Even if you aren’t obese, you can still take the deduction if the doctor directs you to lose weight as treatment for another disease, such as hypertension or heart disease.

Which expenses can you deduct? IRS says that the fees paid to join the program and to attend periodic meeting are deductible. However, the cost of low-calorie food that you eat in place of your regular diet is a nondeductible personal expense. IRS also won’t let you deduct membership dues in a gym, health club, or spa.

Bear in mind that medical expenses are an itemized deduction and are deductible only to the extent the expenses exceed 7.5% of your adjusted gross income. However, the cost of a weight-loss program that qualifies as a deductible medical expense can be reimbursed through an employer’s medical flexible spending account, thus providing the equivalent of a deduction without having to meet the 7.5% limit.

If you had expenses in earlier years that were deductible under these rules, but you failed to claim them, you may be able to get a tax refund by filing an amended return. Generally speaking, tax returns can be amended for three years after the due date.

If you have any questions regarding this or any other tax issue, please feel free to contact us.

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