Face Masks and Other PPE Treated as Deductible Medical Expenses
March 30, 2021
Tax-Favored Accounts May Reimburse Certain COVID-19 PPE Expenses
The Internal Revenue Service has issued Announcement 2021-7, clarifying that amounts paid for certain personal protective equipment (PPE)—such as masks, hand sanitizer and sanitizing wipes—used for the primary purpose of preventing the spread of coronavirus (COVID-19) are deductible medical expenses.
Amounts paid for COVID-19 PPE are also eligible to be paid or reimbursed under:
- Health flexible spending arrangements (FSAs);
- Archer medical savings accounts (Archer MSAs);
- Health reimbursement arrangements (HRAs); or
- Health savings accounts (HSAs).
However, if an amount is paid or reimbursed under any of the above accounts, or any other health plan, it will not be considered a deductible medical expense.
Group health plans (including health FSAs and HRAs) may be amended pursuant to the announcement to provide for reimbursements of expenses for COVID-19 PPE incurred for any period beginning on or after Jan. 1, 2020, if certain requirements are satisfied.
© 2021 HR 360, Inc.