Home Test for COVID-19 Is Eligible Medical Expense: IRS

A BinaxNOW rapid COVID-19 test made by Abbott Laboratories is shown in Tacoma, Wash., on Feb. 3, 2021. Ted S. Warren/AP Photo

The Internal Revenue Service (IRS) on Sept. 10 said that the cost of home testing for COVID-19 is an eligible medical expense.

The IRS said that the cost for home testing for COVID-19 can be paid or reimbursed under health flexible spending arrangements, health savings accounts, health reimbursement arrangements, or Archer medical savings accounts.

“That is because the cost to diagnose COVID-19 is an eligible medical expense for tax purposes,” the IRS said in a news release.

“The IRS also reminds taxpayers that the costs of personal protective equipment, such as masks, hand sanitizer and sanitizing wipes, for the primary purpose of preventing the spread of COVID-19 are eligible medical expenses that can be paid or reimbursed under health FSAs, HSAs, HRAs, or Archer MSAs,” a spokesperson added.

The agency’s news release comes as President Joe Biden last week issued sweeping new federal vaccine requirements that could affect as many as 100 million Americans.

Biden signed a new executive order mandating that federal workers get a COVID-19 vaccine and removed the option for workers and contractors to choose not to get vaccinated.

He also announced that he will direct the Department of Labor to develop a rule that will require companies with more than 100 employees to mandate vaccinations or once-per-week testing for their workers, potentially affecting tens of millions of U.S. private-sector employees and health care workers.

The Internal Revenue Service (IRS) building stands in Washington on April 15, 2019. Zach Gibson/Getty Images

As of yet, it is not clear if employers or employees will have to cover the costs of COVID-19 tests, which can range anywhere between $25 to $150.

In an effort to improve access to rapid tests for all consumers, top retailers that sell at-home, rapid COVID-19 tests—Walmart, Amazon, and Kroger—will offer the tests at cost for the next three months, Biden said while unveiling his six-pronged “path out of the pandemic” strategy.

“This means that Americans will be able to buy these tests at their local retailers or online for up to 35 percent less starting by the end of this week” the administration said, adding that “the administration has also taken action so that Medicaid must cover at-home tests for free for beneficiaries, and that states should ensure that any tools they use to manage at-home testing do not establish arbitrary barriers for people seeking care.”

The administration said it would also expand the number of retail pharmacy sites around the country where people can get free COVID-19 tests to 10,000 pharmacies.

Biden is reportedly set to announce even more COVID-19 measures before the U.N. General Assembly meets this week, according to U.S. Surgeon General Vivek Murthy.

Speaking to CNN on Sept. 12, Murthy explained, “There will be more actions that we continue to work on, especially in the global front.”

“What the president and what all of us have said as public health leaders from the earliest part of this pandemic is that we have to use every level of government, and we all in the private sector have to do everything we can to tackle this virus,” Murthy added. “The requirements the president announced are an example of that.”