Can you write off medical expenses on your tax return?

First off, most people fall short in their financial plan because they don’t put a proactive tax management strategy in place.   So often people are not sure if they can take a medical expense deduction, so they do not even research it.  The general rule is a taxpayer may deduct expenses paid for medical care.  These can be expenses of the taxpayer, their spouse, or a even a dependent to the extent that the expenses exceed 7.5% of Adjusted Gross Income in 2012 and 10% of their AGI beginning in 2013.  AGI is the number on the bottom of page one of your tax return.

You can also deduct things like mileage and travel essential to the medical care, Long Term Care services, even  insurance premiums covering medical care or long term care.  The biggest trap is medicines.  Drugs must be prescribed by a doctor to qualify.

You should always talk to your financial advisor or a qualified CPA before making any decisions.

For more information or to setup a Tax Consultation contact oXYGen Financial – 1.800.355.9318 or Visit Us Here

Source and Interview: By Dana Fowle, FOX 5 I-Team – http://www.myfoxatlanta.com/story/21434499/tax-time-can-you-deduct-medical-expenses

Here is a list of other deductible expenses:

Abortion. You can include the expenses of a legal abortion.

Acupuncture. The cost for such treatment is deductible.

Alcoholism. Payments to a treatment center qualify, including the cost of room and board.

Animals. The cost of guide dogs to aid the blind, deaf and disabled are deductible.

Artificial limb. The cost of the prosthesis and associated expenses are deductible.

Assisted living. A portion of the entrance fee and monthly or annual fees for an assisted living facility can qualify as medical expenses.

Automobile expenses. If you drive your own car
to get medical care, you can deduct 16.5 cents a mile for medical driving in 2010, plus any parking or toll charges. The rate for 2011 is 19 cents per mile.

Birth control pills. As with other prescribed medicines, the cost is deductible.

Blood sugar test kits for diabetics.

Blood transfusions.

Braille books and magazines. The amount by which the cost exceeds that of regular reading material may be written off.

Breast reconstruction surgery following a mastectomy.

Canadian drugs are not deductible. Although many Americans save money by purchasing prescriptions from Canadian pharmacies, the costs may not be deducted.

Car. The cost of outfitting an auto with special controls needed by a handicapped person may be included with your medical expenses.

Car expenses. If you drive your own car to get medical care, you can deduct 24 cents a mile for medical driving in 2009, plus any parking or toll charges. The rate for 2010 is 16.5 cents per mile.

Childbirth preparation classes. The IRS says fees for the mother qualify, but fees for the father-coach do not.

Chiropractors. Their fees qualify.

Christian Science practitioners. Fees are deductible.

Contact lenses. The cost qualifies, as does the cost of insurance against their loss.

Cosmetic surgery, if necessary to ameliorate a deformity arising from a congenital abnormality, injury or disease remains deductible; not if the surgery directed at improving appearance rather than meaningfully promoting proper function of the body.

Crutches. What you pay to buy or rent crutches or other medically necessary equipment is deductible.

Damages. If you receive a settlement in a damage suit that includes money for future medical expenses, the amount is not taxable, but neither are those future medical expenses deductible until they exceed the amount of the award allocated to medical care.

Dental treatment. The cost of everything from diagnostic x-rays to orthodontic treatment to dentures qualifies, including treatments not covered by your insurance.

Doctor’s fees. When adding them up, count payments to anesthesiologists, dermatologists, gynecologists, neurologists, obstetricians, ophthalmologists, osteopaths, pediatricians, podiatrists, psychiatrists, surgeons and any other recognized medical practitioners.

Drug addiction treatment. As with treatment for alcoholism, treatment for drug addiction is deductible.

Eyeglasses. Include in the deductible amount the fees for eye exams as well as the cost of the glasses.

Fertility treatments.

Full-body electronic scan.

Guide dog. Medical expenses can include the cost of a guide dog for the blind or deaf, including the cost of the dog’s care.

Hearing aid. The cost of the device itself and associated fees are deductible.

Home improvements required by medical conditions — such as a filtration system to combat allergies or an entrance ramp for a disabled homeowner — to the extent they do not increase the value of the home.

Hospitalization. The costs, including the cost of meals, not covered by insurance are deductible.

Imported drugs are not deductible. Although many Americans save money by purchasing prescriptions from Canadian and other foreign pharmacies, the costs are not deductible.

Insurance. Premiums you pay for health insurance, prescription drug insurance, contact lens replacement insurance, Medicare Part B and Medicare Part D, Medicare supplemental policies, student health fees and a portion of long-term care policies are all deductible. (Self-employed taxpayers can qualify to deduct insurance premiums as an adjustment to income rather than a medical expense and thereby avoid the 7.5% rule that applies to other medical expenses.)

Kidney donor expenses.

LASIK or other vision correction surgery.The cost is an allowable medical expense.

Lead-based paint removal. This is one of the stranger examples of the way the IRS views qualifying medical expenses. You can count as a deductible expense the cost of removing lead-based paint if the paint is within the reach of a child who has suffered from lead poisoning. The cost of removing paint out of the reach of the child doesn’t count toward the medical deduction, nor does the cost of repainting the scraped area.

Long-term care insurance. You can also include in your medical expenses part of what you pay for long-term care insurance. The maximum annual write-off is based on your age.

Medicare Part B premiums.This is an easy-to-miss deduction, since the cost is deducted from Social Security benefit checks. Don’t make that mistake. The premiums are deductible.

Medicare Part D premiums.Add the premiums to your other deductible expenses.

Medicine. Include in your deductible medical expenses what you pay for any prescription medicines and insulin. The cost of over-the-counter medicines is not deductible.

Nursing homes. Nursing home fees can quickly mount up to 7.5% of almost anyone’s income. If the availability of medical care is the primary reason a person is in the institution, the full cost can be deductible, even though much of the cost is actually for otherwise nondeductible expenses such as food and lodging.

Nursing services. Include in your medical expenses wages and other amounts you pay for nursing services, including social security taxes you pay on the caregiver’s wages.

Organ donor expenses.If not reimbursed, such costs are deductible medical expenses.

Oxygen. The costs of oxygen equipment and oxygen to relieve breathing problems that are caused by a medical condition are deductible.

Physicals. The IRS now says the cost of routine annual physicals is deductible.

Podiatrists fees Although sometimes not covered by insurance, such costs are deductible.

Pregnancy test kit. The IRS says the cost is now deducible.

Prescription drugs. The cost is deductible.

Psychoanalysis. Fees paid for psychoanalysis are deductible.

Psychologist. Also count what you pay a psychologist for care.

Student health fees. Colleges and private schools sometimes include in their tuition charges a fee for student medical care. If you can get a breakdown of the bill showing what part of the total goes to those fees, you can include that amount in your deductible medical expenses.

Seeing eye dog and its maintenance.

Stop-smoking program.

Sterilization. The cost of such an operation, including a vasectomy, is deductible.

Swimming pools, if medically necessary but, as with other medically required home improvements, only to the extent that the cost exceeds any addition to the value of your home.

Telephone. What you pay for special equipment to permit the deaf to communicate over the phone is deductible.

Television. The cost of a decoder so that a TV picks up closed-caption signals for the hearing impaired can be included with your medical expenses.

Travel expenses to get medical care. This includes bus and subway fare or ambulance hire or, if you drive your own car.

Vasectomy.To the extent the cost is not covered by insurance, it is deductible.

Vision correction surgery, such as LASIK. Your out-of-pocket cost is deductible.

Weight-loss program, if recommended by your doctor as part of the treatment for a specific medical problem, such as hypertension or obesity.

Wheelchair. Whether manual or motorized, its cost is deductible.

Wig for the mental health of a patient who has lost hair due to a disease.

X-rays.Any cost not covered by insurance is deductible.

Written By:

Van Pappas

Vice President, oXYGen Financial, Inc.

For more information or to setup a Tax Consultation contact oXYGen Financial – 1.800.355.9318 or Visit Us Here

About the author  ⁄ Ted Jenkin @ Your Smart Money Moves

Ted Jenkin has spent the past 23 years giving personal financial advice to thousands of people across the United States. After graduating from Boston College in 1991, Ted spent more than 16 years working for American Express Financial Advisors/Ameriprise Financial. He was one of the youngest people in the history of the company to reach both Field Vice President and Group Vice President level. He managed more than 800 financial advisors throughout 8 states in his last position with the company. In 2008, Ted founded oXYGen Financial to help revolutionize the financial services industry by creating a new company that focused on serving the X and Y Generation. oXYGen Financial now has more than 2,200 clients throughout 25 states across the country many coming from social media techniques. Ted has been featured in over 30 magazines and newspapers including the Wall Street Journal, Business Week, and The Huffington Post. He was on the cover of Registered Rep magazine and featured in the ‘what will financial planning look like in 2023’ article done by Financial Planning Magazine. He has six advanced designations from the College for Financial Planning (CFP®, CRPC®, CRPS®, AWMA®, AAMS®, CMFC®) and is an on air radio personality.

7 Comments

  • March 4, 2013

    I have never gotten past that 7.5%, so I use a Flexible Spending Account (FSA) for my medical expenses. It is easier and I don’t have to exceed some arbitrary figure or percentage.

  • Van Pappas
    March 5, 2013

    FSA’s are a great way to pay for medical expenses with Pre-tax dollars. Good job. Keep staying healthy so you do not have to get over that 7.5% treshold.

  • HH
    March 5, 2013

    What about therapeutic supplements prescribed by a medical doctor? These are pharmacy type pharmaceuticals you grab from CVS with a prescription, however they are prescribed by a medical doctor to address a health issue. Just wondering, thanks

  • HH
    March 5, 2013

    **Correction** “These are NOT pharmacy type pharmaceuticals you grab from CVS with a prescription, ” — meaning they have their own catalogue they would prescribe out of (for example if you have low thyroid they prescribe natural supplements versus synthetics you get with a prescription), Just wondering how those expenses could be written off if possible, Thanks

  • Van
    March 10, 2013

    The key is a “written prescription from a medical doctor”. If the doctor writes you a prescription for Asprin, then you can go buy Asprin and deduct the expense. If the doctor just tells you that you need to take Asprin, then you have no written prescription and cannot deduct the expense for that purchase.

    Feel free to call us if you need more detail. 678-551-7968.

  • March 21, 2013

    Excellent article. I will be facing a few of these issues as well.
    .

  • Van
    March 21, 2013

    Thanks. Feel free to reach out if you need any advice. http://www.linkedin.com/in/vanpappas

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