Do you want to know if you may deduct medical expenses from your taxes? Your finances may be greatly impacted by medical expenditures, particularly in periods when healthcare prices are high. The good news is that you might be able to lower your tax liability by deducting some medical expenses from your income. However, it can be difficult to figure out which costs are eligible for this deduction and how to submit a claim. In this article, we'll go over what medical expenses are tax-deductible, as well as whether you may claim the deduction or not.

What to Know About Medical Expenses?

The IRS defines medical expenses as a broad category of charges related to the identification, management, and avoidance of illnesses or injuries. Payments for the services of physicians, surgeons, and other medical professionals are included in these costs. Prescription drugs, insulin, X-rays, lab work, contact lenses, glasses, nursing care, and hospital stays are also counted as eligible medical expenses.

It is imperative that you maintain comprehensive documentation of any medical expenses incurred, as they can qualify for a tax return deduction if they fulfill specific requirements established by the IRS. You may make the most of your potential tax savings and claim any deductions that are available to you based on your medical expenses by keeping proper records.

Medical Expense Deduction and What Is the Deduction Value?

According to the IRS, medical expenses are deducted from taxes under specific circumstances. Unreimbursed expenditures for treatments, surgeries, dental and eye care, prescription drugs, and medical appliances like glasses and hearing aids are all considered qualifying medical expenses. You can also deduct costs like mileage, bus fare, and parking fees that are associated with traveling for medical care.

Your adjusted gross income is used to determine the medical cost deduction value (AGI). If a taxpayer uses Schedule A to itemize their deductions, the IRS permits them to deduct any total eligible unreimbursed medical care expenses exceeding 7.5% of their AGI. If your adjusted gross income (AGI) is $45,000 and your medical expenses total $5,475, only costs more than $3,375 are eligible for an itemized deduction. The remaining amount you can deduct for medical expenses is $2,100 ($5,475 minus $3,375).

However, because of the Tax Cuts and Jobs Act (TCJA) of 2017, certain taxpayers find it more difficult to take advantage of itemized deductions, such as those for medical costs, since the standard deduction has almost doubled. You may choose to take the standard deduction in place of the itemized deduction if your itemized deductions are less than the standard deduction. That way, you won't be able to deduct medical expenses.

Top Medical Expenses You Didn't Realize Were Deductible

Here is a list of top medical expenses you can deduct.

Alternative Medical Interventions

According to the IRS, trips to nontraditional practitioners and alternative medical therapies like acupuncture and chiropractic care are typically deductible medical costs. Furthermore, if an authorized healthcare provider prescribes or recommends alternative therapies, they might also be deducted.

A vast array of therapies and interventions targeted at improving health and treating medical disorders can be included in these alternative treatments. Herbal cures, massage therapy, naturopathic therapies, homeopathy, and other practices are a few examples.

It's crucial to remember that not all alternative therapies might be eligible for a deduction, and the requirements might change based on a person's specific situation and IRS guidelines. Making sure you appropriately claim any allowable deductions for alternative medical treatments on your tax return can be facilitated by keeping thorough records of your spending and seeking advice from a tax expert.

Improvements for the Home

If you renovate some portions of your house or install permanent features to accommodate a disability, you may be able to claim the costs of these renovations as medical expenses on your taxes.

These upgrades could entail, among other things, building ramps, enlarging entrances, changing kitchen cupboards, or installing support bars. The deductible amount is only available for expenses that are more than any appreciation in the home's value brought about by the upgrades.

Disorders of the Eyes and Ears

According to IRS regulations, costs related to eye and ear disorders are deductible from taxes as medical costs. The price of eye exams, prescription glasses, contact lenses, lens solutions, and even surgical procedures are all covered by these deductions for various parts of eye care. Moreover, costs for Braille books for people with visual impairments are also deductible.

Similarly, those who have hearing loss can write off costs for hearing tests, hearing aids and the batteries that go with them, and language improvement or lip reading/Braille instruction programs. Maintaining thorough records of all outlays and seeking advice from a tax expert is essential for claiming these deductions and ensuring that tax returns are filed in accordance with IRS guidelines.

Accommodations for Medical Care

You might be able to claim the cost of your lodging as a medical expense on your taxes if you're undergoing medical treatment away from home. This deduction is applicable to stays where the primary purpose is receiving medical care from a doctor in licensed facilities.

But the accommodation can't be ostentatious or meant for leisure or pleasure. The most that can be deducted for accommodation costs is $50 per person per night, with the option to include costs for a partner who is traveling with the patient for medical attention.

The Bottom Line!

It's crucial to remember that you can only deduct medical expenses that are greater than 7.5% of your adjusted gross income, even though there are other eligible medical expenses that you may be able to claim on your taxes.

Furthermore, you will not be able to claim this deduction if your total itemized deductions do not exceed the newly increased standard deduction. It is also essential that you examine the list of eligible (and non-qualified) expenses and determine if it is financially advantageous for you to claim this deduction.