August 5, 2019

IRS provides tax break for 23andMe as a medical expense

The Internal Revenue Service issued a ruling allowing taxpayers to use a tax-advantaged flexible spending account to pay for the medical portion of an ancestry test from the genetic testing service 23andMe.

The ruling letter was issued in May to the taxpayer, but was announced this week by 23andMe and reported on by The Wall Street Journal. It permits money set aside in an FSA to be used to purchase the health-related information provided through 23andMe’s Health + Ancestry Service. Although the letter was issued to a specific unidentified taxpayer, the ruling would likely also apply to other taxpayers using either a flexible spending account or a health savings account to pay for genetic tests that include a medical testing component.

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