Deducting Personal Protection Equipment

The IRS has announced that the cost of personal protective equipment (PPE) such as masks, hand sanitizer and sanitizing wipes is an amount paid for medical care, if the primary purpose of the expense was for the purpose of preventing the spread of COVID. Thus, amounts paid for PPE by an individual taxpayer for use by the taxpayer, the taxpayer’s spouse or the taxpayer’s dependents is a deductible medical expense if it is not reimbursed by insurance.

Most taxpayers will not benefit from this deduction since only medical expenses in excess of 7.5% of the taxpayer’s adjusted gross income are deductible as itemized deductions. Additionally, due to the increased standard deduction ($12,400 single, $24,800 married filing jointly or $18,650 head of household) most taxpayers no longer itemize deductions. However, because the cost of PPE has been determined to be a medical expense, any amount spent on PPE is eligible to be paid/reimbursed under health savings accounts (HSAs), health flexible spending arrangements (FSAs), Archer medical savings accounts (Archer MSAs) and health reimbursement arrangements (HRAs). Any amount reimbursed under one of these plans, cannot also be deducted as an itemized deduction.

Subject to certain limitations, eligible educators may deduct up to $250 of unreimbursed qualified expenses incurred in connection with their job as educators. Qualified expenses include such items as professional courses, books, and materials used in the classroom. The definition of qualified expenses has been extended to include the cost of PPE, disinfectant and other supplies used for the prevention of the spread of COVID if paid by an eligible educator after March 12, 2020.

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