If you paid medical and dental expenses for yourself, your spouse and your qualifying dependents, you may be able to deduct them on your tax return. The IRS defines medical expenses as the costs of diagnostic, treatment, mitigation or prevention of disease and the costs of treatment affecting any part or function of the body. These expenses must be primarily to prevent or alleviate a physical or mental defect or illness. Expenses incurred that will improve general health such as vitamins, spa or massage are not included. In addition, expenses must be paid during the tax year regardless of when the service was provided and you must not receive reimbursement from third party such as insurance companies or your employer.
Reporting of and Limitations on the Medical Expenses:
Medical expenses are reported on the first section of your itemized schedule or Form 1040 Schedule A. However, these expenses are subject to the 7.5% of your adjusted gross income (AGI) limitations, which means that you can only deduct expenses that went over this amount. For example, if your AGI for the year is $100,000 and you have incurred a total medical expenses of $10,000, your medical threshold limitations would be $7,500. This means that you can only deduct $2,500, ($10,000 less $7,500) on your tax return.
List of Medical Expenses Allowed on Your Return
Below are examples of medical expenses that you may be able to deduct on your tax return:
- Birth or Pregnancy Related – pregnancy test kit, fertility enhancement, birth control pills prescribed by your doctor, legal operation to prevent having children such as vasectomy or tubal ligation, legal abortion.
- Drugs and Medical Supplies – prescription medicines and insulins, oxygen equipment and oxygen, special items (contact lenses, prescription glasses, prosthetics, orthotics, artificial limb, hearing aids, wheelchairs), bandages.
- Premiums or Contracts – Medicare Part D premiums, medical and hospital insurance premiums, long-term care contracts.
- Medical Services - diagnostic services such as lab work, therapy, nursing services, physical examination, body scan, fees paid for doctors, physicians, surgeons, and other medical practitioners.
- Health Education and Programs – stop smoking programs, weight-loss or certain expenses for obesity, special education for mentally or physically disabled persons.
- Others - lead-based paint removal, guide dog for the blind and disabled, capital expenses for equipment or improvement to your home for medical care, part of life care fee paid to retirement home designated for medical care, eye surgery to promote the correct function of the eye.
Samples of Expenses That Are not Allowable
- Health and Nutritional Supplements - vitamins, herbal supplements, natural medicines (unless recommended by a medical practitioner as a treatment for a specific medical condition and medicine bought without a doctor’s prescription such as over-the-counter drugs and medicines, bottled water
- Home and Personal care – Toothpaste, toiletries, teeth whitening, cosmetics, diapers, maternity clothes.
- General Health Expenses- health club dues, massage, spa, household help, zumba, dancing or swimming lessons, vacation for general health improvement, weight-loss expenses not for the treatment of obesity or other diseases, surgery for purely cosmetic reasons
- No Double Benefit – any expenses included or reimbursed by flexible saving account, health savings account, contribution to Archers MSAs.
- Other Insurance payments – life insurance or income protection policies providing payment for loss of life, limb. Medical insurance included in a car insurance policy covering all persons injured or by your car.
- Others – burial or funeral expenses, babysitting and childcare, diaper service, nursing care for a healthy baby.