Medical and Dental Expenses
If you itemize your deductions on Form 1040, Schedule A, you may be able to deduct expenses you paid in 2010 for medical care – including dental – for yourself, your spouse, and your dependents. Here are six things the IRS wants you to know about medical and dental expenses and other benefits.
1. You may deduct only the amount by which your total medical care expenses for the year exceed 7.5 percent of your adjusted gross income. You do this calculation on Form 1040, Schedule A in computing the amount deductible.
2. You can only include the medical expenses you paid during the year. Your total medical expenses for the year must be reduced by any reimbursement. It makes no difference if you receive the reimbursement or if it is paid directly to the doctor or hospital.
3. You may include qualified medical expenses you pay for yourself, your spouse, and your dependents, including a person you claim as a dependent under a multiple support agreement. If either parent claims a child as a dependent under the rules for divorced or separated parents, each parent may deduct the medical expenses he or she actually pays for the child. You can also deduct medical expenses you paid for someone who would have qualified as your dependent except that the person didn’t meet the gross income or joint return test.
4. A deduction is allowed only for expenses primarily paid for the prevention or alleviation of a physical or mental defect or illness. Medical care expenses include payments for the diagnosis, cure, mitigation, treatment, or prevention of disease, or treatment affecting any structure or function of the body. The cost of drugs is deductible only for drugs that require a prescription except for insulin.
5. You may deduct transportation costs primarily for and essential to medical care that qualify as medical expenses. The actual fare for a taxi, bus, train, or ambulance may be deducted. If you use your car for medical transportation, you can deduct actual out-of-pocket expenses such as gas and oil, or you can deduct the standard mileage rate for medical expenses. With either method you may include tolls and parking fees.
6. Distributions from Health Savings Accounts and withdrawals from Flexible Spending Arrangements may be tax free if you pay qualified medical expenses.
IRS TAX TIPS January 31, 2011
The following is a list of items that you can or cannot include in figuring your medical expense deduction. The items are listed in alphabetical order.
| Abortion | |
| Acupuncture | |
| Alcoholism | |
| Ambulance | |
| Artificial Limb | |
| Artificial Teeth | |
| Baby Sitting and Child Care | |
| Birth Control Pills | |
| Braille Books and Magazines | |
| Capital Expenses | You can include in medical expenses amounts you pay for special equipment installed in your home, or for improvements, if their main purpose is medical care for you, your spouse, or another dependent. |
| Chiropractor | |
| Christian Science Practitioner | |
| Contact Lenses | |
| Crutches | |
| Dental Treatment | You can include in medical expenses the amounts you pay for dental treatment. This includes fees paid to dentists for X-rays, fillings, braces, extractions, dentures, etc. |
| Drug Addiction | |
| Drugs | |
| Eyeglasses | |
| Guide Dog or Other Animal | |
| Health Club Dues | |
| Health Institute | |
| Health Maintenance Organization (HMO) | |
| Hearing Aids | |
| Home Care | |
| Hospital Services | |
| Insurance Premiums | For policies that cover medical care. |
| Lead-based Paint Removal | |
| Learning Disability | |
| Legal Fees | You can include in medical expenses legal fees you paid that are necessary to authorize treatment for mental illness. However, you cannot include in medical expenses fees for management of a guardianship estate, fees for conducting the affairs of the person being treated, or other fees that are not necessary for medical care. |
| Lifetime Care – Advance Payments | You can include in medical expenses a part of a life-care fee or “founder’s fee” you pay either monthly or as a lump sum under an agreement with a retirement home. The part of the payment you include is the amount properly allocable to medical care. The agreement must require that you pay a specific fee as a condition for the home’s promise to provide lifetime care that includes medical care. |
| Dependents with disabilities | You can include in medical expenses advance payments to a private institution for lifetime care, treatment, and training of your physically or mentally impaired dependent upon your death or when you become unable to provide care. The payments must be a condition for the institution’s future acceptance of your dependent and must not be refundable. |
| Medical Information Plan | You can include in medical expenses amounts paid to a plan that keeps your medical information so that it can be retrieved from a computer data bank for your medical care. |
| Operations | You can include in medical expenses amounts you pay for legal operations that are not for unnecessary cosmetic surgery. |
| Optometrist | See Eyeglasses |
| Osteopath | You can include in medical expenses amounts you pay to an osteopath for medical care. |
| Psychiatric Care | You can include in medical expenses amounts you pay for psychiatric care. This includes the cost of supporting a mentally ill dependent at a specially equipped medical center where the dependent receives medical care. See Psychoanalysis and Transportation. |
| Psychoanalysis | You can include in medical expenses payments for psychoanalysis. However, you cannot include payments for psychoanalysis that you must get as part of your training to be a psychoanalyst. |
| Psychologist | You can include in medical expenses amounts you pay to a psychologist for medical care. |
| Schools and Education, Special | You can include in medical expenses payments to a special school for a mentally impaired or physically disabled person if the main reason for using the school is its resources for relieving the disability. |
| Sterilization | You can include in medical expenses the cost of a legal sterilization (a legally performed operation to make a person unable to have children). |
| Transplants | You can include in medical expenses payments you make for surgical, hospital, laboratory, and transportation expenses for a donor or a possible donor of a kidney or other organ. You cannot include expenses if you did not pay for them. |
| Transportation | Amounts paid for transportation primarily for, and essential to, medical care qualify as medical expenses. You can include out-of-pocket expenses for your car, such as gas and oil, when you use your car for medical reasons. You cannot include depreciation, insurance, general repair, or maintenance expenses. If you do not want to use your actual expenses, you can use a standard rate of 10 cents a mile for use of your car for medical reasons. You can also include the cost of parking fees and tolls. You can add these fees and tolls to your medical expenses whether you include actual expenses or use the standard mileage rate. |
| Tuition | You can include in medical expenses charges for medical care included in the tuition of a college or private school, if the charges are separately stated in the bill or given to you by the school. |
| Weight Loss Program | You cannot include the cost of a weight loss program for your general health even if your doctor prescribes the program. |
| Wheelchair | You can include in medical expenses amounts you pay for an autoette or wheelchair used mainly for the relief of sickness or disability, and not just to provide transportation to and from work. The cost of operating and keeping up the autoette or wheelchair is also a medical expense. |
| X-ray Fees | You can include in medical expenses amounts you pay for X-rays that you get for medical reasons. |