What medical expenses are tax deductible?

Even with good insurance and a low deductible, no one likes paying medical bills. A positive aspect of large bills is the opportunity to claim your medical expenses as a deduction on your tax return, as long as your bills are more than 7.5% percent of your adjusted gross income for your tax year and you can itemize your deductions. The medical expenses deduction not only applies to your medical expenses, but it also applies to the medical expenses of your spouse and dependents.

If your medical procedures cost you more than 7.5% of your income, follow these five rules to maximize your tax refund.

*Keep in mind that adjusted gross income (AGI) is your gross income, such as wages, salaries, or interest, minus adjustments for eligible deductions, such as student loan interest or your IRA deduction. Your AGI can be found on line 11 of your 2020 Form 1040.

Doctor is not just ‘doctor’

The IRS allows tax deductions for dental and vision care, in addition to medical expenses. This means you can potentially deduct eye exams, contact lenses, glasses, dental visits, braces, false teeth, and root canals.

What else is available for medical deductions? Preventive care and surgeries, psychiatric and psychological treatment, prescription drugs, and medical devices, such as hearing aids and home medical equipment, are included in the medical expense deduction..

You can even deduct the cost of your monthly insurance payments if they’re not paid on a pre-tax basis through an employer-provided plan, as well as travel expenses to and from the doctor. The medical expense deduction includes medical expenses you pay for yourself, your spouse, and your dependents.

Non deductible

Before you apply, you should know what It is not tax-deductible. As with anything tax-related, you can’t double-deal your tax benefits.

You cannot claim deductions for any expenses for which you have been reimbursed, either by your insurance or by your employer. If you are using a prepaid medical plan or some other medical reimbursement plan to help with expenses, you cannot claim those expenses as deductions.

It’s also important to know that you can’t claim cosmetic surgery as a medical deduction unless the surgery was part of a life-saving procedure or some other serious health problem. Other nondeductible items include everyday or over-the-counter health supplies such as toothpaste, soap, vitamins, or over-the-counter pain relievers.

You can deduct medical expenses by itemizing your tax deductions

As the headline says, to receive the benefits of the medical expense deduction, you must qualify to itemize your deductions on your taxes, so your itemized deductions such as mortgage interest, state income taxes, property taxes, along with expenses Medical deductibles have to be more than the standard deduction. For tax year 2022 (taxes you file in 2023), the standard deduction is $12,950 for single, $19,400 for head of household, and $25,900 for married filing jointly. You cannot take the standard deduction Y claim the medical expense deduction at the same time.

If you’re self-employed, you can deduct your health insurance premiums even if you don’t itemize your deductions.

pay your bills

You know those medical bills you want to deduct from your income? When did you pay them? For Uncle Sam, you can only deduct medical expenses if they were paid within the tax year in which you are filing. Expenses from the previous year or future expenses cannot be claimed. If you used a credit card to pay medical bills in the tax year, that would count as paid within the year and would be deductible.

Track those miles

Traveling to and from all those appointments counts. For 2022, the medical mileage rate is 18 cents per mile. This includes trips to pick up prescriptions, dental appointments, follow-up appointments, emergency visits and more. Don’t miss out on this valuable deduction.

If you incurred medical expenses during the tax year, it might be worth maximizing your deductions and taking itemized deductions. especially if you itemized deductions exceed the standard deduction.

Don’t worry about knowing these tax rules. TurboTax it asks you simple questions about yourself and provides you with the deductions and credits you qualify for based on your answers. If you have questions, you can connect live via one-way video to a Live TurboTax tax expert with an average of 12 years of experience to get answers to your tax questions. TurboTax Live’s tax experts are available in English and Spanish year-round and can also review, sign, and file your tax return. TurboTax Live’s tax experts can do your taxes from start to finish, too. All from the comfort of your home.