“In a recent information letter addressed to Congressman John Sarbanes, the IRS explained why ‘meal replacements and dietary supplements’ to help people reduce their weight are not a deductible expense under IRC Sec. 213(d)(1). INFO 2007-0037 notes that IRC Sec. 262 prohibits a deduction for personal, living, or family expenses. Food is a personal item, so its cost is nondeductible. Meal replacements, diet foods, and dietary supplements are substitutes for the food that people normally consume. So, the cost of these items is a nondeductible personal expense under IRC Sec. 262.
While the IRS concluded in Rev. Rul. 2002-19 (2002-1 CB 778) that obesity is a disease, the IRS added that taxpayers who are diagnosed as obese cannot deduct any portion of the cost of purchasing reduced-calorie diet foods because, once again, they are substitutes for the food that people normally consume to satisfy their nutritional requirements.”
* The IRS, in Revenue Ruling 2007-72, has stated that the cost of a self-administered pregnancy test kit qualified as a deductible medical expense under Internal Revenue Code Sec. 213(d)(1)(A), even though it tested the healthy functioning of the body rather than attempted to detect disease.
FYI, my special report DEDUCTING MEDICAL EXPENSES ON YOUR 2007 FORM 1040 explains in detail just about everything you always wanted to ask about deducting medical expenses. Click here for more information.
* Do you have a nanny, or any other “household employee”? Kathleen Webb of 4nannytaxes.com answers the question “Why Should You Pay the 'Nanny Taxes?” in her website’s blog. You may also want to review my posting of “Ask the Tax Pro – The Nanny Tax” as a companion piece.
* KPE’s posting on “Ask the Taxgirl: Anniversary Presents” at TAX GIRL just goes to verify “My Best Tax Advice” - DON’T ACCEPT TAX ADVICE FROM ANYONE OTHER THAN A PROFESSIONAL TAX PREPARER!
* The internet’s BAG LADY provides an interesting look at the “Fair Tax” national sales tax proposal in her posting “Is There Really a Fair Tax?”. I wonder if there can ever be a truly a “fair” tax system. The current one is certainly not particularly fair.
* Kudos to Trish McIntire of OUR TAXING TIMES for her recent letter to the editor, reprinted in her blog posting “A Nasty Tax Surprise”.
Her letter clearly describes the current problem -
The letter ends with the plea - “Please contact your Representatives, Senators and the White House and demand that they stop playing politics and pass an AMT patch. There are bills dealing with AMT in Congress now but they need a compromise and members of both parties putting down the rhetoric and thinking of the people who elected them first.”
I apologize for the delay in writing and posting my letter to my local Congress-persons to chastise them for their inaction. I will have it in the mail, and on the blog, next week!
Kelley Phillips Erb, our TAX GIRL, has posted an open letter to Congress on the subject at “Fixing the AMT: A Plea to Congress”. As I said in my comment: “Kelly – you were too polite in addressing the arseholes in DC. They need a good chastisement for their irresponsibility and laziness!”
* Kay Bell of DON’T MESS WITH TAXES and Joe Kristan of ROTH AND COMPANY TAX UPDATE BLOG have each been posting a Year-End Tax Planning series lately. Kay’s Part 5 – “Taking Care of Details” – does not have to do with actual year-end tax moves, but does provide some excellent advice.
Speaking of Kay, in her post “AMT Take 3” she tells us -
“Here in D.C., the word from IRS folks who've been talking with us at the annual Taxpayer Advocacy Panel meeting is that next week is make or break for the AMT patch.
If legislation to keep millions -- estimates range from 20 to 25 million taxpayers -- isn't okayed by next Friday, Dec. 21, then the 2008 filing season will be disrupted on a scale heretofore unseen.”
* TALKING TAXES, the blog of the Citizens for Tax Justice, provides the responses of the Republican Presidential candidates to the question "Who in this country is paying more than a fair share of taxes relative to everyone else: the wealthy, the middle class, the poor or corporations?" in its post “GOP Debate: Who's Paying Too Much in Taxes?”
While not actually answering the question, Fred Thompson (former DA of NYC – on tv at least) made an excellent observation – “Five percent of Americans pay over half the income taxes in this country. 40 percent of Americans pay no income taxes at all.”
In the spirit of providing equal time to the Democrats, AccountingWorld.com provides an article, titled “Dems Call for Taxes on Wealthy at Debate” (so what else is new), with the comments of the Democratic Presidential candidates at a recent debate in Iowa.