Money Girl gives you tricks to cut your taxes while improving your health and getting fit.
A Money Girl podcast listener named John asks:
"After listening to your recent show about Obamacare, I want to know what tax breaks are available for living a healthy lifestyle. Is it possible to save money while getting fit?"
Getting fit is an important goal that improves your life in many ways. Feeling better and looking better can actually help you earn more. In this episode I’ll show you how to also save more money by using fitness-related tax breaks.
Obesity is one of the most problematic public health concerns in the U.S. today. About 70% of adults and over 30% of children are either overweight or obese. They face an increased risk of developing a host of serious health problems, like hypertension, diabetes, and heart disease.
If you’re obese, statistics show that you’ll pay 42% more in medical costs than someone of normal weight. Plus, programs like Medicare and Medicaid spend about 10% more of our taxes to treat overweight patients. Minorities and those with low income, especially children from low-income families, suffer the most from the high cost of obesity.
See also: How to Save Money by Getting Fit
For these reasons, John’s question about financial incentives to encourage fitness is a really good one. Unfortunately, few proposals have been introduced to encourage healthier habits through tax breaks.
There are more health sticks than carrots, such as “sin taxes” and “fat taxes” on cigarettes, alcohol, and unhealthy food. These taxes are designed to make us avoid potentially harmful behavior in the first place.
However, here are 3 main ways that you can still use tax breaks to save money while adopting a healthier lifestyle:
When you itemize tax deductions, you can claim a variety of medical expenses that cut your taxes.
Savings Tip #1: Deduct Your Medical Expenses
When you itemize tax deductions (instead of taking the standard deduction for your tax filing status) you can claim a variety of medical expenses that cut your taxes. These include medical costs paid for yourself, your spouse, and dependents, including health insurance premiums—unless they’re already excluded from your taxable income by an employer.
Which Medical Expenses Are Tax Deductible?
Allowable medical deductions alleviate or prevent a physical or mental illness. They don’t include expenses meant to promote your general well-being or appearance, like vitamins, a gym membership, cosmetic surgery, or a trip to Maui.
However, some of the following allowable deductions may surprise you:
- chiropractic care
- contact lenses
- treatment for drug addiction
- weight loss programs (when recommended by a doctor to treat a medical condition such as obesity or hypertension)
- transportation to get medical care