Make New Year's Quitting Tax Deductible [12/28-3]

TO MAKE A QUIT-SMOKING NEW-YEAR'S RESOLUTION TAX DEDUCTIBLE
DO IT ON A DOCTOR'S ADVICE TO PREVENT OR MITIGATE A DISEASE

Every year millions of Americans fail to keep a New Year's resolution to stop smoking, in part because they can't afford the help of some kind of smoking- withdrawal program and/or nicotine device such as gums or patches.

But that is changing, notes Action on Smoking and Health (ASH), a national antismoking organization which encourages quit-smoking resolutions.

According to a recent report by the Centers for Disease Control, about two-thirds of 105 health maintenance organizations surveyed in 1995 offered some coverage of programs or products that help smokers quit.

Also, as of March, five state Medicaid programs provided reimbursement for smoking counseling or classes to help people quit.

In addition, for those who have to pay for such programs from their own pocket, ASH offers the following tip to at least make the cost tax deductible.

Ordinarily, the cost of smoking withdrawal (like general weight loss and physical fitness) programs are not tax deductible as medical expenses, because they are simply for the general health or physical fitness of the taxpayer, like vacations, saunas, or trips to a local health club or gym.

However, the IRS says that if the purpose of a stop-smoking or weight-loss program is for the prevention or mitigation of a disease, then the cost is deductible as a medical expense. [See Rev. Rul 79-162 re 26 CFR 1.213-1]

Since most smokers have at least some incipient emphysema, asking a physician for a note recommending smoking cessation programs -- and/or devices like nicotine gum or patches -- to prevent or mitigate further breathing loss from emphysema is likely to make the expense deductible at tax time.

Smokers should also look carefully at their medical insurance policies to see if they provide for drug-treatment or drug-addiction programs.

In light on new revelations about the highly addictive nature of nicotine, the companies may now be legally obligated to provide treatment for nicotine addiction as they already do for addiction to other substances, including alcohol, says law professor John Banzhaf, Executive Director of ASH.

click here to return to ASH's Home Web Page: http://ash.org