How to Deduct Medical and Dental Expenses

This year, there are new rules that apply to taxpayers who want to deduct any type of medical expenses on their tax return. These new rules can affect your return, and you should be aware before you file. Familiarize yourself with the following guidelines if you are seeking deductions for your medical or dental expenses.

Adjusted Gross Income: This tax year, in order to claim a deduction, your medical expenses must be greater than 10 percent of your adjusted gross income.

65+ Exception: If you or your spouse is 65 years of age or older, a temporary exception has been enacted through Dec. 31, 2016, which keeps the AGI threshold at 7.5%.

Itemize: You have to itemize your deductions in order to claim medical or dental expenses. These expenses aren’t able to be claimed through a standard deduction on a federal tax return.

Payment During Tax Year: You can only claim expenses you paid during 2014. For check payments, the date of payment is usually determined by the day you delivered or mailed the check, not the day it was cashed.

Out of Pocket Costs: Any expenses that were reimbursed by insurance coverage or other third party agency aren’t eligible for a deduction. You can only include medical and dental expenses that you paid for yourself, your spouse, and dependents.

Qualifying expenses: You can deduct any costs associated with diagnosing, easing, preventing, or treating a disease. Additionally, you can deduct premiums paid for medical coverage policies, as well as long term care insurance. Prescription drugs and insulin expenses may also qualify.

Travel: If you’ve had to travel to obtain medical care, you may be able to deduct any expense incurred as a result of using public transportation, paying tolls or parking, or using an ambulance. If you use your own car, the 2014 standard mileage rate for medical travel is 23.5 cents per mile.

Can’t Double Dip: If you paid for any medical expenses with a Health Savings Account or Flexible Spending Arrangement, you cannot deduct them. Typically, payments from those plans are tax-free already.