Christine Hradsky No Comments

Itemizing Medical ExpensesMedical expenses can be costly — and they’re not always covered by insurance. But there may be a silver lining: You may be able to claim an itemized deduction for the amounts you pay for medical, dental and vision care, if you incur enough costs to exceed the applicable threshold for the tax year. Here are the details about this deduction.

Raising the Bar on Medical Expense Deductions

Before 2013, you could claim an itemized deduction for medical, dental, and vision care expenses paid for you, your spouse and your dependents, to the extent those expenses exceeded 7.5% of your adjusted gross income (AGI). Now, because of a tax law change, an even higher threshold of 10% of AGI applies to most folks. Filing a joint return isn’t necessary to take advantage of this provision based on the age of your spouse.

Deducting Expenses Paid for Supported Relatives

Do you pay medical expenses for a dependent parent, grandparent or adult child? If so, you can add those expenses to your own for itemized deduction purposes. For a person to be your dependent, you must pay over half of his or her support for the year.

If you pass the support test, you can add medical expenses you paid for the supported person to your own expenses for purposes of clearing the applicable AGI hurdle for medical expense write-offs. This is true even if you can’t claim a dependent exemption deduction for the supported person on your return because he or she has too much income.

What if you pay medical expenses for someone but don’t supply over half of his or her support for the year? In that case, you can’t combine that person’s medical expenses with your own for medical expense deduction purposes.

Counting Insurance Premiums

For itemized medical expense deduction purposes, you can include premiums paid for medical, dental and vision-care insurance. You can also include premiums paid for Medicare Parts A, B and D coverage and for Medigap policies. Finally, you can include premiums paid for qualified long-term care insurance policies, subject to the following age-based limits in 2018 (and 2017), which are adjusted annually for inflation:

Maximum Amount Treated as
Medical Expense

Age at Dec. 31 of Tax Year 2018  2017
40 or under $420 $410
41 to 50 $780 $770
51 to 60 $1,560 $1,530
61 to 70 $4,160 $4090
Over 70 $5,200 $5110

Contact your tax advisor for more details. He or she can help ensure that you’ve met the applicable deduction threshold and included all IRS-approved medical expenses on your personal tax return.
IRS rules regarding medical expense deductions have changed. For most taxpayers, it now takes more dental, medical and vision expenses than before to meet the AGI thresholds for these items. Whenever possible, try to pack as many doctor visits and non-emergency procedures into a single year, especially if it’s questionable whether or not you’ll meet the applicable AGI threshold.

IRS-Approved Medical Expenses

Here’s a list of some common items that the IRS accepts as deductible medical expenses:

  • Ambulance
  • Acupuncture
  • Artificial limb
  • Artificial teeth
  • Bandages
  • Braille books and magazines
  • Chiropractor
  • Christian Science practitioner
  • Crutches
  • Dental care
  • Diagnostic devices
  • Eyeglasses
  • Eye surgery
  • Guide dog
  • Hearing aid
  • Hospitalization
  • Insulin
  • Laboratory fees
  • Long-term care services
  • Nursing home
  • Nursing services
  • Operation
  • Optometrist
  • Osteopath
  • Oxygen
  • Psychiatric care
  • Psychoanalysis
  • Stop smoking program
  • Therapy
  • Transplant
  • Transportation to receive medical care
  • Wheelchair
  • X-rays

Contact your tax advisor for a complete list of items that may be deductible. Your tax pro might offer creative suggestions that you might not think of, such as the cost of equipment to help a handicapped individual drive, the costs of special telephone or television equipment for the hearing impaired, and home improvements made for medical purposes (but only to the extent they don’t add value to your home).

Our firm provides the information in this e-newsletter for general guidance only, and does not constitute the provision of legal advice, tax advice, accounting services, investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation. Tax articles in this e-newsletter are not intended to be used, and cannot be used by any taxpayer, for the purpose of avoiding accuracy-related penalties that may be imposed on the taxpayer. The information is provided “as is,” with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.