How are the recommended amounts of folic acid determined?

To better answer your question (a good one at that) here is an excerpt from the Office of Dietary Supplements of the National Institutes of Health (ODS/NIH) web page for folate:

“Recommendations for folate are given in the Dietary Reference Intakes (DRIs) developed by the Institute of Medicine of the National Academy of Sciences. Dietary Reference Intakes is the general term for a set of reference values used for planning and assessing nutrient intake for healthy people. Three important types of reference values included in the DRIs are Recommended Dietary Allowances (RDA), Adequate Intakes (AI), and Tolerable Upper Intake Levels (UL). The RDA recommends the average daily intake that is sufficient to meet the nutrient requirements of nearly all (97-98%) healthy individuals in each age and gender group. An AI is set when there is insufficient scientific data available to establish a RDA. AIs meet or exceed the amount needed to maintain a nutritional state of adequacy in nearly all members of a specific age and gender group. The UL, on the other hand, is the maximum daily intake unlikely to result in adverse health effects.The RDAs for folate are expressed in a term called the Dietary Folate Equivalent. The Dietary Folate Equivalent (DFE) was developed to help account for the differences in absorption of naturally occurring dietary folate and the more bioavailable synthetic folic acid.”
Dr. Michael Roizen, MD
Internal Medicine

The recommended daily amounts of folate/folic acid are developed by a group of experts at the Institute of Medicine, which is part of the National Academy of Sciences. A Recommended Dietary Allowance (RDA) is the average amount of a given nutrient (for example, folic acid) that is needed on a daily basis to meet the basic nutrition needs (meaning what allows them to keep functioning normally) of nearly all (about 98%) of the people in a certain age and gender. So a folate RDA for teens for instance, would be the amount of folate needed to keep 98% of 14-18-year-olds healthy (FYI: people in this age group also need 800 micrograms daily).

The Dietary Reference Intakes (DRIs) determine how much folic acid a person should take. The DRIs are developed by the Institute of Medicine of the National Academy of Sciences. There are three types of reference values to consider:

  • Recommended Dietary Allowances (RDA). This is the average daily amount shown to meet healthy nutritional requirements. It covers about 97%-98% of all healthy individuals.
  • Adequate Intakes (AI). These are used when there’s not enough data for RDAs.
  • Tolerable Upper Intake Levels (UL). This is the maximum daily intake that probably won’t lead to negative health effects.

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