Happy Federal and State Tax-Paying Day! It’s not a real holiday but it’s a big day for many folks. Like last year, this year I paid a professional to compute my tax bill and file my 1040. For the first time in two decades, I have no standard employer income this year. Instead, I have 1099 income from Write Engle, my writing and consulting company, plus the $450 in gift cards for participating in the clinical research trial, plus some investment dividends, plus paltry interest from meager savings.
Things got really interesting on the itemized deductions side. I had to file the new ACA Insurance form for my outrageously expensive insurance through the Health Insurance Exchange (I didn’t file for any federal subsidy so I paid full freight). I had more than 10% of income in health-related expenses: two surgeries plus those monthly health insurance premiums plus prescriptions plus several urgent care visits at more than $100 a pop.
For the first time, I also claimed a tiny amount for gluten free food on 1040 Schedule A. The rule is you can claim the difference between the cost of the regular gluten-laden version of the food and the cost of the gluten free version (read more here) if you satisfy the other requirements for taking the medical deduction. I feel a little weird about this so I only claimed a tiny fraction of what I actually spent because I don’t think I should get a tax break for $2 per box of GFree cake mix. My view for myself is that it’s a luxury and if I want it, I should pay for it. You may feel otherwise and the law is on your side. The only foods I did include in the calculation were GFree pasta, GFree bread (twice as expensive per loaf as regular bread and for half as much bread), GFree frozen meals, GFree cereal. GFree meat products (chicken tenders) and GFree/Dairy Free cheese.
The accountant wasn’t familiar with this particular allowable deduction so he had to investigate it. He was surprised that it existed and he had no idea what celiac disease was. I showed him my documentation for the diagnosis (blood tests with doctor’s orders to follow the strict gluten free diet, although he didn’t want to see the biopsy report–he was a little squeamish when I told him it had pix of my guts) and my pile of itemized receipts for food purchases. He also was surprised by my honesty in claiming the income from the clinical research trial–and by my participation in the trial in the first place. I don’t think it makes me virtuous, just risk adverse. I dread the possibility of being audited so I want to be as squeaky clean as possible.
I wish I could claim deductions for the cats’ vet bills but alas, those dependents don’t count.
Having a professional accountant prepare my taxes may cost a few hundred bucks, but it sure saved me hundreds more in taxes, to say nothing of the aggravation and anxiety and problems avoided, had I done them myself.
What’s your experience with taxes?