To reduce the level of income tax payable, taxpayers can use certain medical deductions. On a federal income tax return, eligible medical expenses that exceed 10% percent of the taxpayer’s adjusted gross income may be deducted. Allowable deductions include medical, dental, and eye care expenses.
In addition to your own expenses, you can take medical deductions for your dependents as well. A person is considered a dependent if they are a relative who lives with you and you provide at least 50 percent of their financial support. The person must also be a U.S. citizen to qualify as a dependent.
To make sure that you get all the medical deductions you are entitled to, keep receipts for all medical expenses incurred for yourself or on behalf of your children. If you are self-employed, you can also include the cost of your medical insurance premiums in your calculations. Be sure to include the cost of any laboratory tests, eye exams, and dental checkups not covered by insurance in your calculations. If you need glasses or contact lenses, their cost can be deducted from your income taxes.
Other expenses that are allowed as medical deductions include the costs of dental implants, ambulance fees, and hearing exams. Expenses incurred in traveling to and from doctors’ appointments can also be deducted. If you need to go out of town to seek medical care, you can deduct these expenses as well. Keep track of the cost of mileage, your oil and gas expenses, and parking to include on your income tax return.
The cost of alternative medical therapies to treat medical conditions may be tax deductible. Alternative treatment options include acupuncture, aromatherapy, and massage therapy. If you aren’t sure whether your treatment would qualify for a medical tax deduction, ask your practitioner for some guidance. Your accountant or a tax preparer will be able to give you some advice in this regard as well.
Some types of expenses do not qualify as medical deductions, and you need to be aware of this fact as well. You will not be able to deduct expenses that you have been reimbursed for through your health insurance coverage policy. Over-the-counter medications are also not covered. If you have expenses related to cosmetic surgery, you can’t use these as medical deductions on your income tax form. Any allowed deductions must be deemed medically necessary to be accepted.