Can You Claim Medical Expenses On Income Tax In The USA?

Yes, you can claim medical expenses on your income tax in the USA if you meet certain requirements. This article from income-partners.net explains the rules and regulations surrounding medical expense deductions, helping you understand what you can include and how to maximize your potential tax savings.

1. What Qualifies as a Medical Expense for Income Tax Purposes?

Medical expenses are defined as the costs you incur for the diagnosis, cure, mitigation, treatment, or prevention of disease, as well as expenses for treatments affecting any part or function of the body. These expenses, deductible on your income tax, encompass payments made for legitimate medical services provided by medical professionals such as physicians, surgeons, dentists, and other recognized medical practitioners. In addition, the IRS allows the inclusion of costs related to equipment, supplies, and diagnostic devices necessary for these medical purposes.

However, it’s important to note that for an expense to qualify as a medical expense, its primary purpose must be to alleviate or prevent a physical or mental disability or illness. Expenses that are merely beneficial to general health, such as vitamins or a vacation, do not qualify as medical expenses for tax deduction purposes.

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What specific types of medical expenses can you include? Here’s a deeper dive:

Legal medical services: Fees paid to doctors, surgeons, dentists, and other medical practitioners.
Medical equipment and supplies: Costs of items like wheelchairs, crutches, and diagnostic devices.
Insurance premiums: Premiums paid for health insurance policies covering medical care.
Transportation costs: Expenses for traveling to receive medical care.
Long-term care services: Costs for qualified long-term care services and insurance contracts.

2. Which Medical Expenses Are Deductible This Year?

Only the medical and dental expenses that you paid during the current tax year are deductible, typically excluding payments for medical or dental care you will receive in future years. An exception exists for decedents, where certain expenses paid by the decedent’s estate within one year of death can be treated as paid by the decedent at the time the services were rendered.

Payments made via check are generally considered paid on the date you mail or deliver the check. For “pay-by-phone” or online accounts, the payment date is determined by the date reported on the financial institution’s statement. Credit card charges are deductible in the year the charge is made, regardless of when you actually pay the credit card bill.

2.1. What happens if I missed claiming a medical expense in a previous year?

You can file Form 1040-X, Amended U.S. Individual Income Tax Return, to claim a refund for the year in which you overlooked the expense. This form allows you to correct errors or omissions on your original tax return. Generally, a claim for refund must be filed within 3 years from the date the original return was filed or within 2 years from the time the tax was paid, whichever is later. It’s crucial to act within this timeframe to recoup any missed deductions.

2.2. What expenses are not deductible?

You can’t include medical expenses that were paid by insurance companies or other sources. This includes payments made directly to you, to the patient, or to the provider of the medical services.

2.3. How do separate tax returns affect medical expense deductions?

If you and your spouse live in a non-community property state and file separate returns, each of you can include only the medical expenses each actually paid. Medical expenses paid from a joint checking account are generally considered paid equally by each spouse unless you can prove otherwise.

In community property states (such as Nevada, Washington, or California), medical expenses paid out of community funds are divided equally when filing separately. If expenses are paid from the separate funds of one spouse, only that spouse can include them. Consult Pub. 555 for more details if you reside in a community property state and are not filing jointly.

3. How Much of My Medical Expenses Can I Actually Deduct?

Generally, you can deduct on Schedule A (Form 1040) only the amount of your medical and dental expenses that exceeds 7.5% of your adjusted gross income (AGI).

3.1. What is adjusted gross income (AGI)?

Adjusted Gross Income (AGI) is your gross income minus certain deductions, such as contributions to traditional IRA accounts, student loan interest payments, and self-employment taxes. It’s an important figure because it’s used to calculate many other tax deductions and credits.

For example, consider a hypothetical scenario involving John and Jane Doe, a married couple residing in Austin, Texas. They have a combined Adjusted Gross Income (AGI) of $80,000. Throughout the tax year, they incurred a total of $10,000 in medical expenses, encompassing doctor visits, prescription medications, and insurance premiums.

To ascertain the deductible amount of their medical expenses, they first compute 7.5% of their AGI:

7.5% of $80,000 = $6,000

Subsequently, they subtract this threshold from their total medical expenses:

$10,000 (Total Medical Expenses) - $6,000 (7.5% of AGI) = $4,000

Thus, John and Jane can deduct $4,000 from their income when filing their taxes. This deduction directly reduces their taxable income, resulting in a decreased tax liability.

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4. Which Medical Expenses Can I Include on My Income Tax Return?

You can generally include medical expenses you pay for yourself, as well as those you pay for someone who was your spouse or your dependent either when the services were provided or when you paid for them. There are specific rules for decedents and for individuals subject to multiple support agreements.

4.1. Can I include medical expenses for my spouse?

Yes, you can include medical expenses you paid for your spouse, provided you were married either at the time the services were received or when you paid the expenses.

For instance, if your spouse received medical treatment before you were married, but you paid for it after getting married, you can include these expenses in figuring your medical expense deduction, even if you and your spouse file separate returns. However, if your spouse had paid the expenses, you couldn’t include them on your separate return.

4.2. What about medical expenses for my dependents?

You can include medical expenses you paid for your dependent if the person was your dependent either at the time the medical services were provided or when the expenses were paid.

For example, you can include medical expenses paid for an individual who would have been your dependent except that they received gross income of $5,050 or more in 2024, filed a joint return for 2024, or could be claimed as a dependent on someone else’s 2024 return.

5. Medical Expenses: Specific Examples

Here’s a list of specific medical expenses you can include when figuring your medical expense deduction:

Abortion: The amount you pay for a legal abortion.
Acupuncture: The amount you pay for acupuncture.
Alcoholism Treatment: Costs for inpatient treatment at a therapeutic center, including meals and lodging. Also, transportation to and from Alcoholics Anonymous meetings if medically advised.
Ambulance Services: Payments for ambulance service.
Artificial Limbs: The cost of an artificial limb.
Artificial Teeth: The cost of artificial teeth.
Bandages: The cost of medical supplies such as bandages.
Birth Control Pills: The amount you pay for birth control pills prescribed by a doctor.
Body Scan: The cost of an electronic body scan.
Braille Books and Magazines: The part of the cost of Braille books and magazines for use by a visually impaired person that is more than the cost of regular printed editions.
Breast Pumps and Supplies: The cost of breast pumps and supplies that assist lactation.
Breast Reconstruction Surgery: Amounts paid for breast reconstruction surgery following a mastectomy for cancer.
Capital Expenses: Costs for special equipment installed in a home, or for improvements, if their main purpose is medical care.
Car Modifications: The cost of special hand controls and other special equipment installed in a car for the use of a person with a disability.
Chiropractor: Fees you pay to a chiropractor for medical care.
Christian Science Practitioner: Fees you pay to Christian Science practitioners for medical care.
Condoms: The amount you pay to purchase condoms.
Contact Lenses: Amounts you pay for contact lenses needed for medical reasons, including equipment and materials required for use.
Crutches: The amount you pay to buy or rent crutches.
Dental Treatment: Amounts you pay for the prevention and alleviation of dental disease.
Diagnostic Devices: The cost of devices used in diagnosing and treating illness and disease, such as blood sugar test kits.
Drug Addiction Treatment: Costs for inpatient treatment at a therapeutic center, including meals and lodging. Also, transportation to and from drug treatment meetings if medically advised.
Eye Exam: The amount you pay for eye examinations.
Eyeglasses: Amounts you pay for eyeglasses needed for medical reasons.
Eye Surgery: The amount you pay for eye surgery to treat defective vision, such as laser eye surgery or radial keratotomy.
Fertility Enhancement: The cost of procedures such as in vitro fertilization.
Guide Dog or Other Service Animal: The costs of buying, training, and maintaining a guide dog or other service animal.
Health Institute: Fees you pay for treatment at a health institute if prescribed by a physician and deemed necessary to alleviate a disability or illness.
Health Maintenance Organization (HMO): Amounts you pay to entitle you, your spouse, or a dependent to receive medical care from an HMO.
Hearing Aids: The cost of a hearing aid and batteries, repairs, and maintenance needed to operate it.
Hospital Services: Amounts you pay for the cost of inpatient care at a hospital or similar institution if a principal reason for being there is to receive medical care, including meals and lodging.
Insurance Premiums: Insurance premiums you pay for policies that cover medical care.
Intellectually and Developmentally Disabled, Special Home for: The cost of keeping a person who is intellectually and developmentally disabled in a special home, not the home of a relative, on the recommendation of a psychiatrist.
Laboratory Fees: Amounts you pay for laboratory fees that are part of medical care.
Lead-Based Paint Removal: The cost of removing lead-based paints from surfaces in your home to prevent a child who has or had lead poisoning from eating the paint.
Legal Fees: Legal fees you paid that are necessary to authorize treatment for mental illness.
Lifetime Care—Advance Payments: A part of a life-care fee or founder’s fee you pay to a retirement home, allocable to medical care.
Lodging: The cost of lodging while away from home if primarily for and essential to medical care, limited to $50 per night for each person.
Long-Term Care: Amounts paid for qualified long-term care services and certain amounts of premiums paid for qualified long-term care insurance contracts.
Meals: The cost of meals at a hospital or similar institution if a principal reason for being there is to get medical care.
Medical Conferences: Amounts paid for admission and transportation to a medical conference concerning the chronic illness of yourself, your spouse, or your dependent.
Medicines: Amounts you pay for prescribed medicines and drugs, including insulin.
Nursing Home: The cost of medical care in a nursing home, home for the aged, or similar institution, for yourself, your spouse, or your dependents, including meals and lodging if a principal reason for being there is to get medical care.
Nursing Services: Wages and other amounts you pay for nursing services.
Operations: Amounts you pay for legal operations that aren’t for cosmetic surgery.
Organ Donors: Amounts paid for medical care you receive because you are a donor or a possible donor of a kidney or other organ.
Osteopath: Amounts you pay to an osteopath for medical care.
Oxygen: Amounts you pay for oxygen and oxygen equipment to relieve breathing problems caused by a medical condition.
Physical Examination: The amount you pay for an annual physical examination and diagnostic tests by a physician.
Pregnancy Test Kit: The amount you pay to purchase a pregnancy test kit.
Psychiatric Care: Amounts you pay for psychiatric care.
Psychoanalysis: Payments for psychoanalysis, excluding payments for training to be a psychoanalyst.
Psychologist: Amounts you pay to a psychologist for medical care.
Special Education: Fees you pay on a doctor’s recommendation for a child’s tutoring by a teacher who is specially trained and qualified to work with children who have learning disabilities.
Sterilization: The cost of a legal sterilization.
Stop-Smoking Programs: Amounts you pay for a program to stop smoking.
Telephone Equipment: The cost of special telephone equipment for persons with hearing or speech disabilities.
Television Equipment: The cost of equipment that displays the audio part of television programs as subtitles for persons with a hearing disability.
Therapy: Amounts you pay for therapy received as medical treatment.
Transplants: Amounts paid for medical care you receive because you are a donor or a possible donor of a kidney or other organ.
Transportation: Amounts paid for transportation primarily for, and essential to, medical care.
Tuition: Under special circumstances, charges for tuition in medical expenses.
Vasectomy: The amount you pay for a vasectomy.
Weight-Loss Program: Amounts you pay to lose weight if it is a treatment for a specific disease diagnosed by a physician, such as obesity, hypertension, or heart disease.
Wheelchair: Amounts you pay for a wheelchair used for the relief of a sickness or disability.
Wig: The cost of a wig purchased upon the advice of a physician for the mental health of a patient who has lost all of their hair from disease.
X-ray: Amounts you pay for X-rays for medical reasons.

6. What Medical Expenses are Not Deductible on My Income Tax Return?

While many medical expenses are deductible, certain expenses do not qualify. Here are some items that you can’t include when figuring your medical expense deduction:

Baby Sitting, Childcare, and Nursing Services for a Normal, Healthy Baby: You can’t include amounts you pay for the care of children, even if the expenses enable you, your spouse, or your dependent to get medical or dental treatment.
Cosmetic Surgery: Generally, you can’t include in medical expenses the amount you pay for cosmetic surgery, unless it is necessary to improve a deformity arising from, or directly related to, a congenital abnormality, a personal injury resulting from an accident or trauma, or a disfiguring disease.
Controlled Substances: You can’t include in medical expenses amounts you pay for controlled substances (such as marijuana, laetrile, etc.) that aren’t legal under federal law, even if such substances are legalized by state law.
Dancing Lessons: You can’t include in medical expenses the cost of dancing lessons, swimming lessons, etc., even if they are recommended by a doctor, if they are only for the improvement of general health.
Diaper Service: You can’t include in medical expenses the amount you pay for diapers or diaper services, unless they are needed to relieve the effects of a particular disease.
Electrolysis or Hair Removal: See Cosmetic Surgery.
Flexible Spending Arrangement: You can’t include in medical expenses amounts for which you are fully reimbursed by your flexible spending arrangement if you contribute a part of your income on a pre-tax basis to pay for the qualified benefit.
Funeral Expenses: You can’t include in medical expenses amounts you pay for funerals.
Future Medical Care: Generally, you can’t include in medical expenses current payments for medical care (including medical insurance) to be provided substantially beyond the end of the year, with certain exceptions.
Hair Transplant: See Cosmetic Surgery.
Health Club Dues: You can’t include in medical expenses health club dues or amounts paid to improve one’s general health or to relieve physical or mental discomfort not related to a particular medical condition.
Health Savings Accounts: You can’t include in medical expenses amounts you contribute to a health savings account. You can’t include expenses you pay for with a tax-free distribution from your health savings account.
Household Help: You can’t include in medical expenses the cost of household help, even if such help is recommended by a doctor.
Illegal Operations and Treatments: You can’t include in medical expenses amounts you pay for illegal operations, treatments, or controlled substances whether rendered or prescribed by licensed or unlicensed practitioners.
Insurance Premiums: See Insurance Premiums under What Medical Expenses Are Includible, earlier.
Maternity Clothes: You can’t include in medical expenses amounts you pay for maternity clothes.
Medical Savings Account (MSA): You can’t include in medical expenses amounts you contribute to an Archer MSA. You can’t include expenses you pay for with a tax-free distribution from your Archer MSA.
Medicines and Drugs From Other Countries: In general, you can’t include in your medical expenses the cost of a prescribed drug brought in (or ordered and shipped) from another country, unless it meets specific legal requirements.
Nonprescription Drugs and Medicines: Except for insulin, you can’t include in medical expenses amounts you pay for a drug that isn’t prescribed.
Nutritional Supplements: You can’t include in medical expenses the cost of nutritional supplements, vitamins, herbal supplements, “natural medicines,” etc., unless they are recommended by a medical practitioner as treatment for a specific medical condition diagnosed by a physician.
Personal Use Items: You can’t include in medical expenses the cost of an item ordinarily used for personal, living, or family purposes unless it is used primarily to prevent or alleviate a physical or mental disability or illness.
Premium Tax Credit: You can’t include in medical expenses the amount of health insurance premiums paid by or through the premium tax credit.
Surrogacy Expenses: You can’t include in medical expenses the amounts you pay for the identification, retention, compensation, and medical care of a gestational surrogate because they are paid for an unrelated party who is not you, your spouse, or your dependent.
Swimming Lessons: See Dancing Lessons.
Teeth Whitening: You can’t include in medical expenses amounts paid to whiten teeth.
Veterinary Fees: You generally can’t include veterinary fees in your medical expenses, but see Guide Dog or Other Service Animal under What Medical Expenses Are Includible, earlier.
Weight-Loss Program: You can’t include in medical expenses the cost of a weight-loss program if the purpose of the weight loss is the improvement of appearance, general health, or sense of well-being, unless the weight loss is a treatment for a specific disease diagnosed by a physician.

Understanding what expenses are not deductible is just as crucial as knowing what is deductible. By avoiding these non-deductible items, you can ensure that you are accurately reporting your medical expenses and maximizing your tax savings.

7. How Do Insurance Reimbursements Affect My Medical Expense Deduction?

You can only include medical expenses for which you haven’t received reimbursement from insurance or other sources. This includes payments from Medicare.

7.1. What if my insurance reimbursement is more than my medical expenses?

If you receive more in reimbursements than you spent on medical expenses, the excess may be taxable income. Whether the excess reimbursement is taxable depends on who paid the premiums for your medical insurance.

Premiums paid entirely by you: If you paid the entire premium, the excess reimbursement is generally not taxable.
Premiums paid by you and your employer: If both you and your employer contributed to the plan, the portion of the excess reimbursement attributable to your employer’s contributions is taxable.
Premiums paid entirely by your employer: If your employer paid the entire cost of your medical insurance plan and their contributions were not included in your income, the entire excess reimbursement is taxable.

Use Worksheet B or C in Publication 502 to calculate the taxable portion of your excess reimbursement, depending on whether you have one or multiple policies.

7.2. What if I receive insurance reimbursement in a later year?

If you receive reimbursement in a later year for medical expenses you deducted in an earlier year, you must generally report the reimbursement as income up to the amount you previously deducted. However, don’t report as income any reimbursement amount that didn’t reduce your tax in the earlier year.

7.3. What if I am reimbursed for medical expenses I didn’t deduct?

If you didn’t deduct a medical expense in the year you paid it because your medical expenses weren’t more than 7.5% of your AGI or because you didn’t itemize deductions, don’t include the reimbursement, up to the amount of the expense, in income.

8. How to Claim the Medical Expense Deduction

To claim the medical expense deduction, you’ll need to itemize deductions on Schedule A (Form 1040). Here’s a step-by-step guide:

Gather your records: Collect all receipts, bills, and statements for medical expenses you paid during the year.
Calculate your AGI: Determine your Adjusted Gross Income (AGI) for the tax year.
Compute the 7.5% AGI threshold: Multiply your AGI by 7.5% (0.075).
Determine your deductible amount: Subtract the 7.5% AGI threshold from your total medical expenses. The result is the amount you can deduct.
Complete Schedule A (Form 1040): Enter your total medical expenses on line 1 of Schedule A, and your deductible amount on line 4.
File your tax return: Submit Form 1040 along with Schedule A.

8.1. What if I sell medical equipment or property in a later year?

If you deduct the cost of medical equipment or property in one year and sell it in a later year, you may have a taxable gain. The taxable gain is the amount of the selling price that is more than the adjusted basis of the equipment or property. Worksheet D in Publication 502 can help you figure the adjusted basis.

8.2. How are damages for personal injuries treated?

If you receive an amount in settlement of a personal injury suit, part of that award may be for medical expenses that you deducted in an earlier year. If so, you must include that part in your income in the year you receive it to the extent it reduced your taxable income in the earlier year. Future medical expenses are also subject to specific rules; you must reduce any future medical expenses for these injuries until the amount you received has been completely used.

9. Understanding Impairment-Related Work Expenses

If you are a person with disabilities, you can take a business deduction for expenses that are necessary for you to be able to work. These impairment-related work expenses are not subject to the 7.5% limit that applies to medical expenses.

9.1. What qualifies as an impairment-related expense?

Impairment-related expenses are those ordinary and necessary business expenses that are:

Necessary for you to do your work satisfactorily.
For goods and services not required or used, other than incidentally, in your personal activities.
Not specifically covered under other income tax laws.

9.2. How do I report impairment-related work expenses?

If you are self-employed, deduct the business expenses on the appropriate form (Schedule C, E, or F) used to report your business income and expenses. If you are an employee, complete Form 2106, Employee Business Expenses, and enter on Schedule A (Form 1040) that part of the amount on Form 2106 that is related to your impairment.

10. Health Insurance Costs for Self-Employed Individuals

If you were self-employed and had a net profit for the year, you may be able to deduct amounts paid for health insurance on behalf of yourself, your spouse, your dependents, and your children who were under age 27 at the end of 2024.

10.1. What are the requirements for this deduction?

The insurance plan must be established under your trade or business, and the deduction cannot be more than your earned income from that trade or business. You can’t deduct payments for health insurance for any month in which you were eligible to participate in a health plan subsidized by your employer, your spouse’s employer, or an employer of your dependent, or your child under age 27, at the end of 2024.

10.2. Where do I report this deduction?

You take this deduction on Form 1040 or 1040-SR. If you itemize your deductions and don’t claim 100% of your self-employed health insurance costs on Form 1040 or 1040-SR, include any remaining premiums with all other medical expenses on Schedule A (Form 1040), subject to the 7.5% limit.

11. Need More Help?

Navigating the complexities of tax deductions can be challenging. The IRS offers numerous resources to help you understand and comply with tax laws:

IRS Website (IRS.gov): The IRS website offers a wealth of information, including FAQs, tax forms, publications, and tools to help you prepare your return.
Free Tax Preparation: If you qualify, you can receive free tax preparation services through the Volunteer Income Tax Assistance (VITA) or Tax Counseling for the Elderly (TCE) programs.
Taxpayer Advocate Service (TAS): TAS is an independent organization within the IRS that helps taxpayers resolve problems with the IRS.

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FAQ: Claiming Medical Expenses on Income Tax

1. Can I deduct medical expenses paid for my adult child?

Yes, if your adult child qualifies as your dependent, you can include their medical expenses. This generally applies if you provide over half of their support, even if they don’t live with you.

2. Are over-the-counter medications deductible?

No, only prescribed medications and insulin are deductible. Over-the-counter medications, even if recommended by a doctor, are not deductible.

3. Can I deduct the cost of cosmetic surgery?

Generally, no. However, cosmetic surgery is deductible if it is necessary to correct a deformity arising from a congenital abnormality, a personal injury, or a disfiguring disease.

4. Can I deduct transportation costs for medical visits?

Yes, you can deduct transportation costs, such as bus, taxi, train, or plane fares, as well as the standard medical mileage rate for using your car.

5. Are health insurance premiums deductible?

Yes, health insurance premiums are deductible as medical expenses, but only to the extent that your total medical expenses exceed 7.5% of your adjusted gross income (AGI).

6. Can I deduct the cost of a special diet recommended by my doctor?

You can include the cost of special food in medical expenses only if:

The food doesn’t satisfy normal nutritional needs,
The food alleviates or treats an illness, and
The need for the food is substantiated by a physician.

7. Can I deduct the cost of improvements to my home for medical reasons?

Yes, you can include in medical expenses amounts you pay for special equipment installed in a home, or for improvements, if their main purpose is medical care for you, your spouse, or your dependent.

8. What is the standard medical mileage rate for 2024?

The standard medical mileage rate for 2024 is 21 cents per mile.

9. Can I deduct expenses for alternative treatments like acupuncture?

Yes, the amount you pay for acupuncture is deductible.

10. Where do I report the medical expense deduction?

You report your medical expense deduction on Schedule A (Form 1040).