Deducting medical and dental expenses is complicated. Your deductions must exceed 7.5 percent of your adjusted gross income and need to fall into an IRS-approved category.
Deductible medical expenses may include, but are not limited to the following:
- Payments of fees to doctors, dentists, surgeons, chiropractors, psychiatrists, psychologists, and nontraditional medical practitioners.
- Payments for inpatient hospital care or residential nursing home care, if the availability of medical care is the principal reason for being in the nursing home, including the cost of meals and lodging charged by the hospital or nursing home. However, if medical care is not the principal reason for the nursing home stay, then the deduction is limited to medical care costs only.
- Payments for acupuncture treatments or inpatient treatment at a center for alcohol or drug addiction; participating in a smoking-cessation program; and drugs to alleviate nicotine withdrawal that require a prescription.
- Payments to participate in a weight-loss program for a specific disease or diseases diagnosed by a physician, including obesity; but not ordinarily payments for diet food items or payment of health club dues.
- Payments for insulin and payments for drugs that require a prescription.
- Payments made for admission and transportation to a medical conference relating to a chronic disease that you, your spouse, or your dependents have (if the costs are primarily for and essential to necessary medical care). However, you may not deduct costs of meals and lodging while attending a medical conference.
- Payments for false teeth, reading or prescription eyeglasses or contact lenses, hearing aids, crutches, wheelchairs, and for a guide dog or other service animal to assist the visually impaired or hearing-disabled person, or for a person with other physical disabilities.
- Payments for transportation primarily for and essential to medical care that qualifies as medical expenses — payments of the actual fare for a taxi, bus, train, ambulance or for transportation by personal car to include the amount of your actual out-of-pocket expenses, gas, oil, etc. Standard mileage rate for medical expenses, plus the cost of tolls and parking apply as well.
Payments for insurance policy premiums that cover medical care or for a qualified long-term care insurance policy are both deductible, but there are some caveats:
- If you are an employee, do not include in medical expenses the portion of your premiums treated as paid by your employer under its sponsored group accident, health policy or qualified long-term care insurance policy.
- You cannot include premiums that you paid under your employer-sponsored policy under a premium conversion policy (pre-tax), paid by an employer-sponsored health insurance plan (cafeteria plan), or any other medical and dental expenses unless the premiums are included in box 1 of your Form W-2, Wage and Tax Statement.
Only include medical expenses paid during the year and use the expenses only once on the return. Reduce your total deductible medical expenses by any reimbursement, whether you receive the reimbursement directly or it’s paid on your behalf to doctors, a hospital or other medical provider.
This is only a summary of a complicated series of rules. To be sure about your situation, you should contact one of our CPAs.