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Face masks, hand sanitizers and sanitizing wipes purchased to prevent the spread of COVID-19 are tax deductible medical expenses, the Internal Revenue Service said Friday.
In Announcement 2021-7, the IRS states that amounts "paid by an individual taxpayer for COVID-19 [Personal Protective Equipment] PPE, for use by the taxpayer, the taxpayer's spouse, or the taxpayer's dependent(s) that are not compensated for by insurance or otherwise are deductible" provided that the taxpayer's total medical expenses exceed 7.5% of adjusted gross income, as stated under Section 213 of the Internal Revenue Code.
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The IRS also said that such purchases are also eligible to be paid for or reimbursed under health flexible spending arrangements (FSAs), Archer medical savings accounts (Archer MSAs), health reimbursement arrangements (HRAs), or health savings accounts (HSAs).
"However, if an amount is paid or reimbursed under a health FSA, Archer MSA, HRA, HSA or any other health plan, it is not deductible" under Section 213.
Group health plans, including health FSAs and HRAs, may also be amended pursuant to the IRS announcement to provide for COVID-19 related reimbursements incurred for any period beginning on or after Jan. 1, 2020, the IRS said.
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Melanie Waddell
Melanie is senior editor and Washington bureau chief of ThinkAdvisor. Her ThinkAdvisor coverage zeros in on how politics, policy, legislation and regulations affect the investment advisory space. Melanie’s coverage has been cited in various lawmakers’ reports, letters and bills, and in the Labor Department’s fiduciary rule in 2024. In 2019, Melanie received an Honorable Mention, Range of Work by a Single Author award from @Folio. Melanie joined Investment Advisor magazine as New York bureau chief in 2000. She has been a columnist since 2002. She started her career in Washington in 1994, covering financial issues at American Banker. Since 1997, Melanie has been covering investment-related issues, holding senior editorial positions at American Banker publications in both Washington and New York. Briefly, she was content chief for Internet Capital Group’s EFinancialWorld in New York and wrote freelance articles for Institutional Investor. Melanie holds a bachelor’s degree in English from Towson University. She interned at The Baltimore Sun and its suburban edition.
