According to IRS Publication 502, medical expenses are "the costs of diagnosis, cure, mitigation, treatment, or prevention of disease, and the costs for treatments affecting any part or function of the body." The publication goes on to clarify in its definition that these costs include equipment needed for these purposes. Exercise equipment, including treadmills, may meet the terms of this definition, and might be a deductible expense, depending on a few factors.
Purpose of Treadmill
If you are using the treadmill to treat or prevent a disease, the purchase price of the treadmill is deductible. Examples of this include using a treadmill to help with weight loss when obesity is causing health problems, or to lower high blood pressure. If you do not have a medical condition that the treadmill is being used to treat, but are just using a treadmill to stay in shape, you have less legal rationale to deduct the price of a treadmill, although you might be able to argue that you are preventing a disease.
The IRS could always argue that you can walk without a treadmill, for far less money, and attempt to claim that a treadmill is not medically necessary. While you don't need a treadmill to walk or run, you can argue that your personal safety is a concern, particularly if the only opportunity that you have to exercise is during the night. In addition, in areas prone to bad weather, or severe cold, outside walking at a speed necessary to raise your heart rate may not be practical either.
To further ensure that you do not run afoul of the IRS tax rules when deducting your treadmill purchase price, you can obtain a doctor's order or prescription for the equipment. In some states, you may also be able to use the doctor's order to avoid paying sales tax on your purchase as well. Keep a copy of your doctor's order with your receipt for the treadmill in case your tax return is ever audited.
Limitations on Deductions
To deduct the price of a treadmill, you must itemize your deductions using Schedule A of Form 1040. The price of the treadmill is part of your unreimbursed medical expenses. Medical expenses are deductible to the extent that they exceed 7.5 percent of your adjusted gross income. For example, if you have $40,000 in adjusted gross income, you can deduct any medical expenses that exceed $3,000. If you have $5,500 in unreimbursed medical expenses, including your treadmill, you can deduct $2,500 on your Schedule A tax form.
Sale of Equipment
If you later sell your treadmill, you should claim the sale price of the equipment on your income tax as taxable income, if you deducted the purchase price when you obtained it. You could do this by adding the sale price to your income, and attaching an explanation of the addition. Or, if you are deducting medical expenses the year that you sold the treadmill, you could deduct the amount of the sale from your medical expenses for the year.
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