Janztaxnospam[at]aol.com (JanZtaxNOSPAM) wrote:

- quote -

Joe Smith can make any argument they like. However, the IRS made
it quite clear in the ruling that non-Rx drugs are not deductible
on the Schedule A. A better issue is how the heck can they audit
this properly and will the employers or their agents spend any
time auditing the requests for reimbursements. And.... with the
advent of debit cards, it's not clear to me that any serious
auditing will be done by the employer or its agents..

Alan
http://taxtopics.net

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New IR-2003-108 says that Over-the-Counter Drugs are to be
Covered by Health Care Flexible Spending Plans. Examples
given in Rev. Rul. 2003-102 include such items as antacids
and allergy meds (nonprescription). I'm wondering if this
won't have tremendous implications for future health care
deductions. Presumably a self-employed person with an MSA
can get reimbursed for these expenses. Couldn't Joe Smith,
who doesn't have a FSP or MSA, argue that by making these
expenses reimburseable, they are being treated as the
equivalent of being deductible (since the reimbursement is
tax-free money) and therefore, he should be allowed to
deduct the same expenses on schedule A?

Jan Zobel EA
Oakland, CA

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