Tuesday, August 3, 2010
Wall Street Journal, At Work, a Drug Dilemma
An employee recently approached Josh Ward, an executive at a Denver plumbing company, with a question he never thought he'd hear. Her husband, the employee said, is a state-registered medical marijuana patient. Could she buy his marijuana with her company-provided flexible spending account? ...
Mr. Ward did a bit of research and quickly told the employee no. Her account, funded with pretax dollars, is regulated by the IRS and cannot be used to purchase a drug that's illegal under federal statutes, even if Colorado treats it as a legitimate medication.
- IRS Publication 502, Medical and Dental Expenses 15 (2009): "You cannot include in medical expenses amounts you pay for controlled substances (such as marijuana, laetrile, etc.), in violation of federal law."
- MSNBC, Should Your HSA Pay for Pot?: "Why can't you use your Health Savings Account or Flexible Spending Account to pay for it? ... One cannot use the cost of marijuana because it is not legal under federal law," says Dean Patterson of the IRS.
(Hat Tip: David Herzig.)
Update: Don't Bogart That Deduction: IRS Says Marijuana Is a Medical Expense