To be eligible to deduct the excess costs of a gluten-free diet under Internal Revenue Code Section 213, you must have a documented reason to require the observance of a gluten-free diet, along with a physician’s prescription to follow a gluten-free diet. This should provide sufficient documentation of eligibility.
The excess cost of gluten-free food can be deducted if you can deduct expenses paid for medical care for yourself, a spouse, or a dependent, to the extent the aggregate expenses exceed 10 percent of adjusted gross income.
If you meet both criteria above and choose to itemize deductions start collecting receipts and record them regularly. Download a spreadsheet from the Celiac Sprue Association for calculating the deductible expense.
Again the deductible portion is limited to the increased cost of a specialty diet over a regular diet.
The IRS determined that those who must adhere to a strict non-gluten diet may write off the higher expenses of their diet to the extent that the specialty diet requires excess cost over an ordinary diet.
March 24, 2011 Letter Ruling – DEPARTMENT OF THE TREASURY
INTERNAL REVENUE SERVICE – Thomas D. Moffitt – Chief, Branch 2 – Office of Associate Chief Counsel – (Income Tax & Accounting)
I am responding to your inquiry to Commissioner Douglas H. Shulman dated February 25, 2011. You requested that we revise published guidance to taxpayers clarifying the tax treatment of special foods purchased to treat celiac disease.
Taxpayers can deduct expenses paid for medical care of the taxpayer, spouse, or dependent, to the extent the expenses exceed (10 percent) of adjusted gross income. Section 213(a) of the Internal Revenue Code. Medical care refers to amounts paid for the diagnosis, cure, mitigation, treatment, or prevention of disease, or for the purpose of affecting a structure or function of the body. Section 213(d)(1)(A).
Therefore, if a taxpayer can establish the medical purpose of the diet, such as through a physician’s diagnosis, then to the extent the cost of the food for the special diet exceeds the cost of the food that satisfies a taxpayer’s normal nutritional needs if the special diet were not required, the excess cost is an expense for medical care under section 213(d).
We will consider modifying the language of Publication 502, Medical and Dental Expenses, to reflect these considerations.