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Can I Claim a Tax Deduction for Medical Expenses?

By Selena Maranjian - Apr 5, 2016 at 12:48PM

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You can and you should -- if your qualifying medical expenses exceed a certain amount. Here's a quick primer to help you start figuring out if yours do.


Photo: Carolien Dekeersmaeker, Flickr

If your life is full of doctor visits, lab tests, prescription drugs and occasional surgeries -- or even if you just spend a lot on a health-related expense now and then -- Uncle Sam offers a silver lining: You may be able to claim a tax deduction for your medical expenses.

Medical expenses need to exceed 10% of your adjusted gross income to result in a deduction. Image: Pixabay

Deductions and rules
As you prepare your annual tax return, any deductions you're allowed to take will reduce your taxable income -- and therefore, the amount of tax you'll have to pay. Have taxable income of $70,000 and $5,000 in deductions? Presto -- your taxable income is now $65,000. If you're in the 25% tax bracket, you avoid being taxed on that $5,000 and save $1,250. If you have $10,000 in deductions and are in the 33% tax bracket, you can save $3,300!

Of course, there are rules you'll have to follow and criteria you'll have to meet. While some deductions have few limits, the deduction for medical expenses has a sizable one: You can only deduct the portion of your qualifying medical expenses that exceed 10% of your adjusted gross income (AGI) -- which is your gross income less certain adjustments (such as contributions to a traditional IRA). Thus, if your AGI is $50,000, for example, and you have $5,000 or less in qualifying medical expenses, you'll get no tax relief. If you have $6,000 in qualifying medical expenses, though, you can take a $1,000 deduction. If your AGI is $100,000, you'll only be able to deduct the amount of qualifying expenses that exceeds $10,000.

The threshold used to be 7.5%, but Congress has hiked it to 10%. Older taxpayers (those 65 and above) are, fittingly enough, grandfathered in for the old level through the 2016 tax year. After that, it'll be 10% for them, too.

Image: Pixabay

Qualifying medical expenses
So what, exactly, is considered a "qualifying" medical expense? The IRS provides a long list of allowable expenses, along with many examples of those that wouldn't qualify.

The kinds of medical expenses that the IRS permits you to take deductions for are related to the following products, treatments, conditions, and services, among others.

  • Acupuncture
  • Alcoholism treatment
  • Ambulance transport
  • Annual physical exams
  • Artificial limbs
  • Artificial teeth
  • Bandages
  • Birth control pills
  • Body scans
  • Braille reading materials
  • Breast pumps and supplies
  • Breast reconstruction surgery
  • Chiropractors
  • Contact lenses
  • Crutches
  • Dental treatment
  • Diagnostic devices
  • Doctor visits
  • Drug addiction treatment
  • Drugs
  • Eye exams and eyeglasses
  • Eye surgeries
  • Fertility treatments
  • Hearing aids
  • Home care services
  • Home improvements
  • Hospital services
  • Insurance premiums
  • Lab fees
  • Lead-based paint removal
  • Legal abortions
  • Legal fees related to healthcare
  • Long-term care
  • Medical conferences
  • Nursing homes
  • Nursing services
  • Osteopathic care
  • Oxygen
  • Pregnancy test kits
  • Prostheses
  • Psychiatric care
  • Psychological counseling
  • Service animals
  • Smoking cessation programs
  • Special education
  • Sterilization
  • Surgeries
  • Therapies
  • Transplants
  • Weight-loss programs
  • Wheelchairs
  • Wigs
  • X-rays

Note that not every expense related to any topic above is automatically allowable. Health insurance premiums, for example, are on the list above, but you can't deduct any portion of those that are paid through your paycheck because they already bypass taxation. With regard to weight-loss programs, you can deduct some expenses related to treating a doctor-diagnosed condition, such as obesity or high blood pressure. These would include membership fees for a weight-loss program, but not simply fees for gym membership -- though you may be able to deduct specific expenses incurred at a gym, such as personal-training fees. See?

Sorry, Zumba class typically won't qualify as a deduction. Photo: JBLM MWR, Flickr

For more details on any items of interest, check out the IRS list and read up on the rules.

Medical expenses that don't qualify

The kinds of expenses that don't pass muster with the IRS include tooth-whitening, the aforementioned gym membership fees, cosmetic surgery, and hair removal or hair transplants. Dancing lessons, maternity clothes, nonprescription drugs, veterinary fees, babysitting expenses, funeral expenses, toothpaste, vitamins, and diaper services are more expenses, among others, that don't qualify.

For those with significant medical expenses, this deduction can be a great help come tax time. Just be sure to follow the rules and don't get carried away. Know that above-average medical deductions can draw the attention of the IRS and will sometimes result in an audit. That's not a terrible thing if your deductions are legitimate, of course.

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