IRS Reverses Position on Deductibility of Breast Pumps

Breast pumps and lactation-assistance supplies are now eligible for reimbursement under flexible spending arrangements and health savings accounts, according to Internal Revenue Service (IRS) Announcement 2011-14, released February 10.                                     

The announcement reverses the IRS's previous position that breastfeeding equipment did not qualify as "medical care" under Code section 213(d).  Analogizing breast pumps and related supplies to obstetric care, the IRS noted that both "are for the purpose of affecting a structure or function of the body of the lactating woman."  Expenses in this category are now eligible for the itemized deduction for medical expenses under Code section 213, and may be reimbursed through flexible spending arrangements, health savings accounts, health reimbursement arrangements, and Archer medical savings accounts. 

Additional tax changes lie ahead for both flexible spending arrangements and the medical expense deduction under health care reform.  Beginning January 1, 2013, contributions to flexible spending arrangements will be limited to $2,500.  Also beginning in 2013, medical expenses will only be deductible under Code section 213 if they exceed 10% of the taxpayer's adjusted gross income—an increase from the current 7.5% of adjusted gross income threshold.