6 Steps to a Gluten-Free Tax Deduction (and Writing Off Thousands of Dollars of Gluten-Free Groceries on Your Taxes)

Is the cost of gluten-free groceries breaking the bank?

Well, you may be in luck because there is actually a gluten-free tax deduction.

Since gluten-free food is medically required for people with celiac disease, the Internal Revenue Service (IRS) actually makes the difference in cost between gluten-free food and “regular food” a legally deductible medical expense. Too few of us know about this wonderful perk that can significantly help us deal with the excessive costs of gluten-free food.

It may be months until you have to do your taxes again, but that makes this the perfect time to learn how you can benefit from a special tax deduction every celiac should know about. After all, the more you write off, the more of your money you get back!

Follow these 6 steps to write off your gluten-free grocery costs…

• You must have a documented medical diagnosis of celiac disease from a doctor. Sadly, this deduction is not available for people who do not have positive celiac blood test or biopsy results, even if they are gluten intolerant.

• Save every single grocery receipt throughout the year if it includes special gluten-free items. Produce, milk, meat, and other naturally gluten-free items do not count. You want to save receipts for products like crackers, cookies, cake mix and cereal – products you are paying more for because you must buy special gluten-free versions. If you order your gluten-free groceries online, be sure to print out and save those receipts as well.

• Use Excel or another spreadsheet software to create a price list for each item you bought and its “regular” (non-gluten-free) equivalent. If you bought gluten-free cake mix, list the cost of regular wheat-based cake mix in one column and in a second, list the cost of your gluten-free mix. In the third column goes the difference in price, which is the amount that you’ll use for your gluten-free tax deduction.For instance, if a box of gluten-free spaghetti is $4.99 and a box of regular spaghetti is $1.29, the difference is $3.70. The amount that’s tax-deductible is $3.70. It may seem like a lot of work and documentation for a small amount of money, but over the course of the 12 months, this amount could total thousands of dollars of gluten-free tax credits (or even more if several family members have celiac disease).
• Products that are necessary for gluten-free cooking but simply unnecessary for non-gluten-free cooking, such as special dough enhancers, xanthan gum, or quinoa flour (none of which have non-gluten-free versions) are dealt with differently. Their entire cost is tax deductible!

Keep track of shipping costs for mail order purchases, as these are deductible. The mileage for driving to and from a special store to obtain gluten-free foods is also deductible, and you will want to look up this year’s mileage rate so you calculate it correctly.
Only the part of your medical expenses that exceed 7.5% of your income are deductible, so be sure you’re not just keeping track of food expenses but also all of your medical co-pays, mileage to and from doctor’s visits, acupuncture or chiropractor visits, doctor-prescribed supplements, and all medical expenses not covered by insurance.

For most people, regular medical expenses are not worth recording because it would be difficult to reach this 7.5% threshold. However, for people who must follow an expensive gluten-free diet, it may start to make sense.

By following these 6 steps, you will be well on your way to creating your own gluten-free tax deduction.

Note: As always, it is recommended that you consult with a tax professional before you submit your taxes if you plan to itemize for medical deductions.