Tax Deductible? OTC Drops, Saline, Lubricants

[LaDiva]

Has anyone tried to write off their OTC drops, saline, lubricants etc. as a medical deduction on their income tax? Can you do this? Thanks!

[indrep]

Depending on which state you live they can be exempt from state sales tax if the therapy is prescribed by a physician. I am not familiar with federal medical expense write offs.

[Rebecca Petris]

Here's a link to the discussion we had at tax time last year. To the best of my understanding the answer re: deductions on federal tax returns is no, with the exception of contact lens solutions.

The last time we looked at this (as you'll see in the link) there was a change that was supposed to kick in for the 2011 tax year but it applies to FSAs and HRAs, not tax deductibility. You may want to look at some of the IRS documents linked in that thread or call an accountant.

[Scout]

The IRS changed the rules for OTC medical expenses for reimbursement under health savings or medical savings accounts. That is the amount that you choose to be taken out of your paycheck before taxes for medical expenses. We used to be able to use that for all kinds of OTC products, eye drops, eye wash, lid scrubs, moisture chambers, etc. etc. All you needed was for the receipt to note that it was a medical expense. All stores would note that on the receipt.

http://www.irs.gov/newsroom/article/...227308,00.html

A. Section 9003 of the Affordable Care Act established a new uniform standard for medical expenses. Effective Jan. 1, 2011, distributions from health FSAs and HRAs will be allowed to reimburse the cost of over-the-counter medicines or drugs only if they are purchased with a prescription. This new rule does not apply to reimbursements for the cost of insulin, which will continue to be permitted, even if purchased without a prescription.

So now the only way to get OTC products covered under your medical savings account is to have your doctor write a prescription for all of your OTC eye care products.

As a general deduction on your Federal tax returns, a prescription is also required. However, most people don’t accumulate enough medical expenses to qualify as a tax deduction on federal tax returns.

http://www.irs.gov/taxtopics/tc502.html

If you itemize your deductions on Form 1040, Schedule A, you may be able to deduct expenses you paid that year for medical care (including dental) for yourself, your spouse, and your dependents. Publication 502, Medical and Dental Expenses, contains additional information on who will qualify as a dependent. You may deduct only the amount by which your total medical care expenses for the year exceed 7.5% of your adjusted gross income. You do this calculation on Form 1040, Schedule A in computing the amount deductible.

The cost of drugs is deductible only for drugs that require a prescription, except for insulin

[LaDiva]

Alas! Thank you indrep, Rebecca, and Scout. The answer seems clear, and I truly appreciate the information. Thank you very much.