Many of us make new year resolutions to take better care of our health. But considering the high prices of food and everything else these days, medical costs are not exception. So, can you claim out-of-pocket medical expenses as a tax deduction?
Well, it depends, but many expenses are deductible. However, there are several limitations and requirements that make it challenging for many taxpayers to actually claim a deduction.
The Rules For Claiming Medical Expenses As A Tax Deduction
If your unreimbursed costs exceed 7.5% of your adjusted gross income, then medical expenses can be claimed as a tax deduction. Plus, these types of expenses are only deductible if you itemize. As such, your itemized deductions cannot exceed your standard deduction.
However, due to the 2018 Tax Cuts and Jobs Act, may taxpayers no longer itemize. Did you know that eligible medical costs also include expenses other than doctor and hospital bills. Check out the following items to consider when determining a possible deduction.
1. Dependents and Others
You can deduct the medical expenses you pay for children and similar dependents. Other dependents who may qualify are a parent or grandparent. But not if he or she files jointly or has too much gross income. In general, you can claim medical costs for a child of divorced parents if you’re the parent who pays the expense.
2. Prescriptions, Dental Work, Hearing Aids, and Eyeglasses
Deductible expenses include the cost of glasses, contacts, hearing aids, dentures and most dental work. But cosmetic expenses like teeth whitening don’t qualify. However, some medically necessary cosmetic surgery is deductible. Prescription drugs qualify, but nonprescription drugs such as aspirin don’t, even if a physician recommends them. Neither do amounts paid for treatments that are illegal under federal law, such as marijuana, even if permitted under state law.
3. Transportation
The cost of getting to and from medical treatment is an eligible expense. This includes using your own vehicle, public transportation or taxi fares. Car costs can be calculated at 21 cents per mile for miles driven in 2024, plus parking and tolls. Alternatively, you can deduct your actual costs, including oil and gas, but not general costs such as maintenance, insurance or depreciation.
4. Weight Loss Programs
If diagnosed as a disease by a doctor, you can claim a weight loss program as a medical expense tax deduction. For example, hypertension, obesity or another disease for which a physical directs you to lose weight. Make sure that you get a written diagnosis. In such cases, deductible expenses include attending meetings, fees paid and a weight loss program. But low calorie food that you might eat in place of a regular diet is not deductible.
5. Nurses and Therapists
Services provided by individuals other than physicians can qualify if they relate to a medical condition and aren’t for general health. For instance, the cost of physical therapy after knee surgery does qualify, but the cost of a personal trainer to help you get in shape doesn’t. Also qualifying are amounts paid for acupuncture and those paid to a psychologist for medical care. Additionally, certain long-term care services required by chronically ill individuals are eligible.
Track Eligible Costs
As you can see, for deduction purposes, many medical expenses are eligible. Keep track of your outlays and we will determine if you qualify for a deduction when we prepare your tax return. Book your appointment today, or contact us if you have questions.
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