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If yous or your dependents have been in the hospital or had other costly medical or dental expenses, keep those receipts — they could aid cutting your revenue enhancement bill. Hither's a look at how the medical expense deduction works and how you can make the most of it.

What is the medical expense deduction?

For tax returns filed in 2022, taxpayers can deduct qualified, unreimbursed medical expenses that are more than 7.5% of their 2021 adjusted gross income . And so if your adjusted gross income is $forty,000, anything beyond the first $three,000 of medical bills — or 7.5% of your AGI — could be deductible.

That ways if you lot had $10,000 in medical bills, $7,000 of them could be deductible.

The 7.five% threshold used to be x%, but legislative changes at the finish of 2019 lowered it.

What kind of medical expenses are revenue enhancement deductible?

IRS Publication 502 has the full list, only in a nutshell here'south what counts equally a medical expense.

Payments to doctors, dentists, surgeons, chiropractors, psychiatrists, psychologists and other medical practitioners
Hospital and nursing home care
Acupuncture
Habit programs, including for quitting smoking
Weight-loss programs for doctor-diagnosed diseases, including obesity (just diet food and health social club dues usually don't count)
Insulin and prescription drugs
Access and transportation to medical conferences nigh diseases that you lot, your spouse or your dependents have (but meals and lodging don't count)
Dentures, reading or prescription eyeglasses, contacts, hearing aids, crutches, wheelchairs and service animals
Transportation costs to and from medical care
Insurance premiums for medical care or long-term care insurance if they're non paid by your employer and y'all pay out of pocket after taxes

Other rules for the medical expense deduction

Y'all tin just include the medical expenses you paid during the year
Yous can't include expenses you were reimbursed for (and then if insurance paid the bill, it's not deductible)

What's non deductible?

Funeral or burying expenses
Over-the-counter medicines
Toothpaste, toiletries and cosmetics
Vacations
Most cosmetic surgery
Nicotine gum and patches that don't crave a prescription

How to claim the medical expense deduction

You lot'll demand to take the following steps.

Itemize on your taxes

Outset, you lot'll need to itemize instead of taking the standard deduction . That can hateful spending more time on tax prep, but if your standard deduction is less than your itemized deductions, you should itemize and save coin anyway. If your standard deduction is more than than your itemized deductions, take the standard deduction and salve some time. (Read more about itemizing versus taking the standard deduction. )

Use Schedule A

Schedule A allows yous to do the math to calculate your deduction. Your tax software can walk you through the steps.

Is it worth claiming medical expenses on taxes? Consider your filing status

Filing separately if you're married could become you a bigger medical-expenses deduction, simply this move is risky because you might lose other revenue enhancement breaks . Let'southward say your spouse racked upwardly $6,000 in medical bills last year. If yous file jointly and your combined AGI is $100,000, then only the portion of your medical bills over 7.5% of that — or the portion over $7,500 — is deductible. Then in this scenario, y'all can't deduct any of your $half-dozen,000 in medical bills.

Now, let'due south say you file separately. Your AGI is $75,000 and your spouse's AGI is $25,000. Because the medical bills are your spouse'southward, he or she could deduct anything over 7.5% of that $25,000 AGI, or $1,875. That would hateful a $four,125 tax deduction for filing separately.

Keep good records

Hang onto those bills, and ask for records from your pharmacy or other care providers to fill in the holes, says Peter Gurian, a Dallas-area CPA.

"If you lot're taking this deduction, you're probably pretty sick or you've got some problems that demand to exist dealt with. If that'southward the example, then the key is to really do a practiced job of keeping track of every single expense and expenditure," he says.

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State thresholds for the medical expense deduction

Your land might have a lower AGI threshold, which could save yous money, says Chris Whalen, a certified public auditor in Cherry-red Banking company, New Bailiwick of jersey. In that country, for instance, the AGI threshold for deducting medical expenses is just 2%, which means taxpayers there might become a break on their state income taxes fifty-fifty if they tin't go one on their federal income taxes.

Whalen says it'south of import to discover out what your state's rule is; you might leave money on the table otherwise. "I see it every twelvemonth, all the time," he says.

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