People who pay income taxes to the United States sometimes get to take advantage of itemized deductions. The restrictions on the amount you are allowed to include in your itemized deductions for medical care is a lot less than it once was, but since 2010 Americans have been allowed to deduct the cost of some acne care products.
Itemized Deductions on Your Federal Tax Return
Americans compute their taxable income by adding up wages, taxable interest and dividends, capital gains, and then subtracting deductions to gross income such as contributions to retirement and health savings accounts and alimony. This computation determines adjusted gross income. The amount of income that is taxable may be further reduced by personal exemptions and either a standard deduction or itemized deductions, whichever is greater.
At one time, Americans paid considerably higher tax rates but had a considerably greater range of itemized deductions. Medical expenses, for example, used to be deductible without regard to income. Nowadays, Americans are eligible to count medical expenses in excess of 7.5% of their adjusted gross income. That’s the income at the bottom of the first page of your 1040.
If your medical expenses are not greater than 7.5% of your income minus certain adjustments as computed for line 38 of your 1040, you don’t get any medical deduction at all. You may still be able to take other kinds of itemized deductions. But including allowable acne expenses may give you a deduction against your taxes for medical expenses and lower the amount you owe or increase your refund.
The IRS Doesn’t Have a Category for “White Lies”
While we can’t give you specific, actionable tax advice for any of your tax returns, we can explain the general principles. But before we get into the definitions of what you can take for your itemized deductions, we want to remind you of a general principle.
The IRS doesn’t like it when you make up your own tax rules.
If you make up deductions for your return and you’re audited, you can be subject for penalties for fraud. These aren’t cheap. You can easily more than double your entire tax bill. Claiming deductions for which you spent absolutely no money at all would fall into this category.
If you try to play the game of “oh, nobody told me that,” you might get negligence penalty of 25% of your tax bill. Taking a deduction for treating your dog’s acne on your personal income tax return might fall into this category.
Even though tax preparers aren’t cheap, they at least have to be registered with the IRS, and having someone else prepare your return for you minimizes the chances you will be assessed a penalty for negligence or fraud. But you still need to know the kinds of expenses you can deduct on your return. Your preparer may be hesitant to ask you about expenses if there is some risk asking the question might offend you or hurt your feelings.
The Kinds of Acne Expenses You Can Deduct on Schedule A
Treatments for active acne—that is, whiteheads, blackheads, and pimples—you receive from a licensed health practitioner are deduction if you pay them in the tax year. You can deduct the expense even if you pay for it with your credit card or cash. You can’t deduct the whole amount of the expense if you worked out a payment plan with your doctor unless you paid the whole amount in the tax year. And you can’t deduct amounts your insurance company paid at all. Deducting what your insurance company paid on your own tax return will likely get you zinged with a negligence penalty.
The IRS rules allow you to deduct amounts you pay to doctors, nurse practitioners, and other licensed health practitioners. They do not allow you to deduct amounts you pay to cosmetologists, aestheticians, barbers, hairdressers, or the lady who does your nails. IRS rules allow you to deduct amounts you pay for prescription medications (but not the amount your insurance company pays for you). If a doctor or nurse practitioner or any other licensed health practitioner writes a prescription for a medication or a device you can deduct the amount you pay to get it filled. You can’t deduct what insurance pays for you.
So what sorts of things can you write off on Schedule A?
- Your copay for an office visit to a doctor for acne treatment.
- The entire cost of an office visit to a doctor for acne treatment if you pay it youself.
- The entire cost of prescription antibiotics, benzoyl peroxide, or herbal therapies, even if the item is available over the counter. For instance, you can get 5% benzoyl peroxide without a doctor’s prescription. Or your doctor may write you a prescription for 5% benzoyl peroxide. As long as the brand of benzoyl peroxide you buy matches the brand on the prescription, you can deduct what you pay for it even if the pharmacy didn’t bother to check your paperwork.
- The cost of lamps and cleaning devices for active acne your doctor recommends for you.
- Your out of pocket cost for treatments to prevent further outbreaks of acne.
There are also expenses you can’t write off on your US tax return. Generally speaking, the IRS rules allow you to write off payments for treatment of an active disease but not to write off payments for treatments that help you look better. You can’t expense cosmetics (unless you are an actor or your line of work depends on your personal appearances, and then only for a specific documented performance or public appearance related to your work).
You can’t expense treatments you receive from unlicensed healthcare practitioners. If you are getting natural acne care, this issue is a little tricky. Some states, mostly in the western United States, license naturopaths and other kinds of holistic healers. You can deduct payments for these kinds of services in these states. Other states, notably Tennessee, make the practice of naturopathy illegal. You could not expense payments to a naturopath who performed services for you in Tennessee, but you could, for instance, live in Tennessee and still take a deduction for your payments for acne treatment to a naturopath in Oregon, where naturopathy is licensed and legal.
A Red Flag to Avoid
Light therapy for acne is a deductible expense. Tanning beds operated by a doctor or nurse practitioner on their premises is a deductible expense. Taking the cost of any other trips to a tanning salon that is not operated by a doctor or nurse practitioner will flag your return. The IRS has a special program to track this specific deduction. It’s OK to visit the tanning salon. Just don’t take the cost of the visit off your income!
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