Are GLP-1s Like Ozempic Tax Deductible?

A KFF poll reveals that 1 in 8 adults (12%) say they're taking a GLP-1 drug, and more than 25% of users with health insurance are paying the full cost of the drugs themselves. Oof! That's a pretty steep cost for drugs that could cost anywhere from $150-$350/mo... and without insurance, brand name injectables could range north of $900/mo.

But could you deduct the medical expense? Maybe!

If you need a crash course on what counts as a tax deduction, check out our guide here. But for now, let's see how you may be able to net some tax savings when April rolls around.

Under IRS Publication 502 and Section 213 of the tax code, a medical expense is deductible only when it's used for the "diagnosis, cure, mitigation, treatment, or prevention of disease." In 2024, the IRS issued guidance (FS-2024-07) reaffirming this framework for GLP-1 medications specifically.

That means if your doctor prescribed Ozempic because you've been formally diagnosed with Type 2 diabetes, that's a textbook deductible expense. If your doctor wrote you a script because you want to slim down without a documented diagnosis, the IRS won't let you deduct it.

✅ Generally deductible if prescribed to treat...

• Type 2 diabetes
• Obesity (an IRS-recognized chronic medical condition)
• Cardiovascular disease
• Hypertension
• Fatty liver disease (MASLD/NASH)
• Chronic kidney disease

❌ Generally NOT deductible if used for...

• Cosmetic weight loss (e.g., "I want to lose 15 lbs for my reunion")
• General health improvement without a formal diagnosis
• Off-label use without a documented disease diagnosis
• Prescribed by a provider but no formal diagnosis on file

3 things to think about

Even if your medication qualifies, you still have to meet 3 requirements in order to claim your GLP-1 medication as a tax deduction.

1. You must itemize deductions

Medical expenses are deducted on Schedule A, which means you have to itemize your deductions, and itemizing only makes sense if your total deductions exceed the standard deduction. Roughly 90% of taxpayers take the standard deduction. That means the majority of GLP-1 users won't benefit from itemizing unless they have significant additional deductions like mortgage interest, state and local taxes, charitable contributions, and other medical costs that, combined, exceed the standard deduction. For the 2025-2026 tax year, the standard deduction amounts are as follows:

If you choose to itemize, don't forget these other tax deductible expenses count too! If you need help keeping track of your tax deductible expenses, Keeper can help. Download the app to try it free!

• 🩺Doctor visit copays / telehealth fees
• 🩸Lab work & bloodwork (A1C, metabolic panels)
• 💉Injection supplies (needles, swabs, sharps)
• 🥕Nutritionist / dietitian visits
• 🏋️‍♂️Weight-loss program costs
• 🚗Medical mileage to appointments
• 🏥Health insurance premiums (out-of-pocket)

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2. Only the amount above 7.5% of your AGI is deductible

Even after you decide to itemize, the IRS won't let you deduct every dollar of medical expense. Only the portion exceeding 7.5% of your Adjusted Gross Income (AGI) counts. For example,:

• Your AGI is $80,000
• 7.5% AGI floor (non-deductible): $6,000
• Total out-of-pocket medical costs: $10,000
• Deductible amount: $4,000

3. Only unreimbursed expenses count

You can only deduct what you actually paid out of pocket. If your insurance covered $800 of your monthly $1,000 prescription, you can only deduct your $200 share. And if you paid with an HSA or FSA, those dollars are already tax-advantaged. You can't double-dip by also claiming them as an itemized deduction!

Pro tip: Use your HSA or FSA!

For the majority of patients, using an HSA or FSA is a better tax strategy than trying to itemize. If you paid for GLP-1 costs out of pocket in 2025 without using an HSA or FSA, it's too late to capture that benefit retroactively. But if you're planning ahead for 2026, adjusting your HSA contributions or FSA election during open enrollment could save you hundreds of dollars per year, even if you never come close to itemizing.

Does compounded semaglutide count as a tax deduction?

Many patients use compounded versions of semaglutide or tirzepatide, often at a fraction of the cost of brand-name GLP-1s. The tax treatment follows the same rules: if the compound is prescribed by a licensed physician to treat a diagnosed condition, it should qualify as a deductible medical expense. The IRS focuses on the prescription and diagnosis, not brand-name vs. compounded.

That said, HSA and FSA administrators may require additional documentation for compounded medications since they aren't FDA-approved drugs by definition. Confirm eligibility with your plan administrator before assuming coverage.

Your tax checklist

• Make sure to get a written prescription for your GLP-1 medication
• Get physician's documentation of your formal diagnosis (Type 2 diabetes, obesity, etc.)
• Get a Letter of Medical Necessity (especially for weight-loss or compounded prescriptions)
• Keep receipts or EOBs for all out-of-pocket GLP-1 costs
• Calculate your AGI and 7.5% floor to determine if exceed it
• Add up all potential itemized deductions to weigh if they exceed the standard deduction
• If not, maximize HSA/FSA contributions instead (make sure that any expenses paid through your HSA/FSA can't be double-deducted!)

Need more help? Chat with a Keeper tax pro!

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