Claiming medical expenses as a deduction on your income taxes will lessen your tax liability if you meet certain restrictions placed by the Internal Revenue Service. To deduct medical expenses, you will have to itemize your deductions. If the standard deduction allowed by the government is more than your itemized expenses, writing off your medical bills will not help you pay less tax.
Medical expenses include any money you pay to diagnose, treat, cure or prevent a disease or condition that affects your body. Types of expenses include charges for services from doctors, dentists and other medical personnel, including Christian Science practitioners. You can deduct expenses for acupuncture and other non-traditional treatments if the government recognizes its effectiveness as a treatment for your condition. You cannot deduct the cost of over-the-counter medications that do not require a prescription.
You can deduct your transportation costs to and from medical or therapeutic appointment. When deducting transportation costs, you can choose to deduct your actual expenses by retaining all of your receipts for items, such as fuel costs, or you can choose to deduct the standard mileage rate for miles driven for medical purposes. As of 2011, the standard mileage rate for medical miles is $.165 per mile, according to the IRS. If you are claiming the mileage deduction, you must have accurate records of all of the miles you travel for appointments. Keep a notebook in your vehicle and list the date, appointment, location and total miles driven to satisfy the IRS in case of an audit.
If your insurance company reimburses you for any medical expenses, you must subtract that amount from the total amount you are claiming. If you receive reimbursements that total more than your medical expenses, you may have to claim the overage as income. A qualified tax professional can help you determine if your reimbursements are taxable.
You can only deduct medical expenses if they total more than 7.5 percent of your adjusted gross income. If your medical expenses total more than 7.5 percent of your AGI, you can only deduct the amount over the 7.5 percent. For example, if your AGI is $50,000, 7.5 percent of your AGI is $3,750. If your medical expenses are $2,000, you cannot deduct the expenses. If your medical expenses are $5,000, you can only deduct $1,250 for your expenses.
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