(UPDATE: The giveaway is now closed. We have our winner! See the comments for more info.)
The first food allergy list has arrived from school this year. According to the school nurse, severe food allergies affect more than 3 million school children. To keep kids safe, each classroom has a list of foods that are prohibited at snack time. Depending on the classroom, the list runs the gamut from eggs to tree nuts to shellfish.
In addition to factoring in allergies, many parents struggle with accommodating dietary restrictions. It can be tough to figure out kids’ eating habits at the best of times but once you add in other factors such as religion, ethics and morality, and concerns about obesity and cholesterol, it’s even more complicated. Fortunately, organic, non-GMO, and gluten-free foods are a bit easier to find than in years past but you do pay a premium. If you have to pay a bit more for special foods, can you at least have the benefit of a tax deduction?
Here’s your lawyerly answer: it depends.
You don’t get a tax deduction for buying special foods to satisfy an ethical or moral sensibility. Even if you have excellent reasons for avoiding animal products, for example, the cost of a diet for ethical or moral reasons isn’t deductible.
You don’t get a tax deduction for buying special foods as the result of a religious belief. Buying Kosher or Halal products doesn’t result in a tax break, even if you’re doing it for a power higher than the Internal Revenue Service.
You also don’t get a tax deduction for the cost of food used to improve your health even if a doctor specifically recommends that you lose weight or otherwise reform your diet. A low sodium, low fat, low sugar diet doesn’t result in a tax deduction. Special foods and beverages which are simply substitutes for your “normal” diet generally aren’t deductible (Harris v. Commissioner, 46 T.C. 672 (1966)); that includes the cost of food in weight loss plans like NutriSystem or WeightWatchers.
Notice the word “generally.” There are some narrow exceptions available. The IRS will allow you a tax break for the cost of special food if the following criteria are met:
- The food must not be used to satisfy normal nutritional needs;
- The food must alleviate or treat an illness; and
- The need for the food must be substantiated by a physician.
In other words, the food must be “special” in some way for the purposes of treating a medically diagnosed illness like severe allergies and disorders such as Celiac disease. If that is the case, the cost of the food would be considered a qualified medical expense for purposes of a tax deduction on a Schedule A (meaning that you must itemize to claim the deduction).
But don’t get too excited just yet. The amount you can deduct as a medical expense is limited to the amount by which the cost of the special food exceeds the cost of a normal diet (Flemming v. Commissioner, T.C. Memo. 1980-583). So, for example, if regular flour is $5/bag and your special flour is $7/bag, you can only include the difference ($2) for purposes of the deduction. Put another way, you cannot deduct the cost of all of your special food; you can only deduct the difference between the cost of your special food and your “normal” food. If there is no such “normal” equivalent, however, the entire cost of the product is deductible.
You’re still not quite done: the total of your qualifying medical expenses must meet a threshold. For 2014, that threshold – sometimes called a “floor” – is 10% of your AGI, or adjusted gross income; for taxpayers 65 and older, the old 7.5% floor still applies until December 31, 2016. To figure your actual deduction, you figure amount of your expenses which exceeds the floor.
Confused? Here’s a quick example: let’s assume you have an AGI of $50,000. For purposes of this example, you can only deduct medical expenses that exceed $5,000, or 10% of your AGI.
- If you have $3,500 in expenses, you don’t meet the threshold, so you cannot deduct your medical expenses.
$3,500 in expenses – $5,000 (10% of $50,000) = -$1,500 - If you have $5,000 in expenses, you meet the threshold but you don’t have any excess, so you cannot deduct your medical expenses.
$5,000 in expenses – $5,000 (10% of $50,000) = 0 - If you have $7,000 in expenses, you meet the threshold and you can deduct $2,000.
$7,000 in expenses – $5,000 (10% of $50,000) = $2,000
Got it? Good. Easy rule of thumb: only special foods that are prescribed by a doctor for a specific medical condition AND which, together with your other medical expenses, exceed the floor are deductible for tax purposes.
Of course, all of this talk about food is making me hungry… which brings me to our next giveaway. One reader will receive a month supply each of Wonderful Pistachios, Wonderful Almonds, POM Wonderful, and FIJI Water.
Wonderful Pistachios and Wonderful Almonds are the perfect on-the-go healthy snacks – both nutritious and delicious. Wonderful Pistachios come in a variety of flavors including Sweet Chili, Roasted & Salted, and Salt & Pepper. Nuts are the ideal replacement to greasy potato chips and will keep students full longer, leaving more time for students to enjoy their day!
POM Wonderful’s 100% Juice Blends are a refreshing drink to pair with your pistachios and almond snacks. These 100% Juice Blends come in three tasty varieties: POM Hula, POM Mango, and POM Coconut, and two convenient sizes: single-serve 12oz bottles and family-friendly 48oz bottles. The 12oz bottles are perfect to pack in lunchboxes for all day, thirst-quenching enjoyment. The 48oz size is ideal for students to enjoy before and after school as a delicious pick-me-up.
Finally, keep your student’s mind awake with simple hydration. Stock up your student’s mini-fridge with a supply of FIJI Water and keep them away from the temptation of sugary soft drinks.
To enter to win, just post a comment below telling me your (or your kids’) favorite snack food. I’ll get you started: My kids can eat their weight in edamame.
Entries must be posted in the comments section for this blog post in the space below by 10:00 p.m. EST on September 19, 2014. It’s just that easy. I’ll choose two winners randomly (using a number generator) out of all of the qualifying entries.
Be sure and read the fine print for more rules because, as you know, I’m a lawyer and I like rules:
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Don’t panic if your comment doesn’t show immediately. If it goes to moderation because, for example, you’re new here, the time stamp on your comment is what counts.
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I love my Twitter followers and my Facebook fans but for this particular giveaway, tweets and Facebook comments will not be counted. Ditto for emails. You must leave your comment on the blog at this post.
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You can enter as many times as you like but you must leave a different answer each time you comment.
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Offensive comments or comments that otherwise violate the comment policy will be deleted and will not be considered valid for purposes of the contest. Similarly, pingbacks and other links will be disregarded for purposes of the contest.
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I will need your full name and your email address: be sure to use your real information when you register to leave a comment. I won’t publish your email address but I do need contact information for the winning entry. If you win and I can’t reach you, it’s a forfeit.
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Due to shipping considerations, you must have a valid United States address. Sorry, Canada, eh?
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I respect your privacy and I will not send you anything unrelated to your entry in this contest. By entering the contest, you agree that I may post any part or all of your submission including your name as a part of the contest announcements or promotions, with the exception of your email address.
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Like Judge Judy, my determination is final.
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Prizes are provided directly by our sponsors and are not exchangeable or redeemable for other prizes. Sponsors do not pay for placement and do not receive any compensation for contributions – neither do I! I have no affiliation, paid or otherwise, with any of our sponsors.
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If you aren’t allowed to participate in giveaways because of the laws in your state or your age or an agreement you’ve made with your mother, consider this giveaway not applicable to you. In other words: void where prohibited or restricted.
Comment away! And thanks for participating in Back To School 2014!
