Deducting Medical Expenses

If you wish to deduct the payment for any type of medical expense this year, you need to be aware of some new rules that apply to these types of deductions, as they can affect your return. If you are seeking medical or dental expenses deductions you should familiarize yourself with the following guidelines.

Adjusted Gross Income – For the current tax year, your medical expenses must exceed your adjusted gross income by 10%.

65+ Exceptions – There is a temporary exception that has been enacted through December 31t 2016 which keeps the AGI income threshold at 7.5% for tax payers 65 or older.

Itemize – In order to claim any medical or dental expenses you must itemize your deductions. These types of deductions are not part of the standard deduction on your federal tax return.

Payments During the Tax Year – You are only able to claim payments made during the 2014 tax year. If you paid by check, the date is typically considered the day you mailed the check and not the date it was cashed.

Out of Pocket Costs – If any of your payments were reimbursed by a third party or insurance plan, you cannot claim them for deduction. You are only able to claim expenses paid for medical and dental procedures for yourself, spouse or qualified dependent.

Travel – You may be able to deduct the cost of travel for medical care. These can include items such as paying for public transportation, tolls, parking or using an ambulance. If you provide your own transportation the standard mileage reimbursement rate is 23.5 cents per mile driven.

No Double Dipping – If you paid for any medical or dental expense with a Flexible Spending or Health Savings Account you cannot deduct the payments. Generally these payments are from plans that are supplied funds that are tax free.