Visit the WHO website for the most current news and information about the coronavirus pandemic.
Meanwhile,continue to accelerate across the country, and President Joe Biden is urging states to maintain or restore mask mandates Since the pandemic in America caused the highest rate of job losses since the Great Depression, the new tax credits could provide welcome relief for some.
“This remains a difficult time for many people, and the IRS is committed to continuing to do everything possible to help taxpayers navigate the unusual circumstances associated with the pandemic, while also dealing with important responsibilities in the area of the IRS, “IRS Commissioner Chuck Rettig said in a statement.
Let’s take a look at how this tax break works and whether it will help you.
What is Covered by the New IRS Deduction?
In late March 2021, the IRS announced that personal protective equipment such as masks, hand sanitizer, and disinfectant wipes purchased on or after January 1, 2020 “to prevent the spread of COVID-19” are considered “medical care products.” This means that you can now add the cost of such items to your medical costs when filing taxes – as long as your annual medical costs exceed 7.5% of youror AGI.
“For most taxpayers with no other major medical costs, this is a threshold that is unlikely to be met, but it could be beneficial for households with other medical costs that would make them exceed that AGI threshold,” said Garrett Watson, senior policy analyst at The Tax Foundation. .
For example, if your AGI was $ 75,000 in 2020, your medical expenses would have to exceed $ 5,625 to write off your personal protective equipment expenses. But that can save some taxpayers quite a bit of money. After all, sales of hand sanitizers are up 600% in 2020 and as a resultin some cases.
Can you get personal protective equipment reimbursed through savings and flexible spending accounts?
“The other change that is likely to be more relevant to many taxpayers is the possibility of reimbursement for personal protective equipment under flexible health care spending plans and health savings accounts,” said Watson. “This means that taxpayers can save on the tax associated with the purchase of personal protective equipment by getting reimbursement from these tax-efficient savings accounts.”
Purchased PPE items can also be reimbursed through medical savings accounts or health reimbursement plans – even if they were purchased by your spouse or dependents.
How to claim this tax benefit
To claim your deductible, you must itemize your taxes on Schedule A (Form 1040). And, most importantly, the personal protective equipment cannot be covered or paid for by insurance or any other type of health plan. Learn more about deducting other health and dental expenses from your tax bill here.
What to do if you’ve already filed your taxes but think you qualify
If you’ve already filed your taxes but think you qualify for the tax break,to make a correction or other changes to your declaration. That said, it may be worth delaying for now: The IRS is currently reviewing the tax implications of the American Rescue Plan Act of 2021 and is expected to provide additional guidance on its impact on tax returns for 2020. related note: If you received unemployment benefits last year and have already filed your taxes for 2020, the IRS recommends that you do not file an amended return until more information is released.)