Deducting Medical Expenses
Posted in Health Insurance
April 3rd, 2009
Your family’s annual medical bills can be extremely high. Routine doctor visits and medication, not to mention dental work or annual vision check-ups, can add up over the course of a year, even for healthy individuals. For many Americans, especially those with children, it’s not unusual to see annual medical expenses of thousands of dollars. If those expenses are not covered by your health insurance, and your income isn’t sufficient to meet your medical needs, you can find yourself in trouble very quickly with high doctors bills.
Fortunately, if you fit this description, there is some relief to be found at tax time. You may already know that, if you are an independent contractor or sole proprietor, you are allowed to deduct health insurance expenses from your taxes. But did you know that you can also deduct certain medical expenses, if they are not covered by your insurance? Many people don’t know that it’s possible to include medical expenses with their itemized tax deductions, and the IRS does allow you to write off some medical expenses if you fall within a certain income bracket and were not reimbursed by your insurance company.
How Medical Expense Tax Deductions Work
Here is how it works. If you have medical expenses that have not been reimbursed by your insurer, and these expenses exceed 7.5% of your adjusted gross income, you can deduct those expenses in your itemized tax deductions. By using the 7.5% guideline, the IRS discourages individuals who can easily afford the expenses from making frivolous claims, while offering relief to taxpayers who might find themselves blinded by unforeseen medical costs.
Deductible Medical Expenses and Restrictions
There are also restrictions on what types of medical procedures are tax-deductible. Cosmetic surgery, for instance, is considered an elective procedure and is not tax-deductible. However, laser eye surgery, dental treatment, and contact lenses are all considered allowable expenses. Your tax preparer can provide a comprehensive list of allowable expenses, but some other deductible expenses include:
As with any itemized deduction, be sure to save your medical bills and paystubs as proof of your eligibility.
[...] so that by year’s end, you will have saved the potential of hundreds in medical expenses.2. Deduct medical expenses. If you have medical expenses that have not been reimbursed by your insurer, and these expenses [...]