Medical expenses can be deducted from your federal tax return as much as they exceed 10% of your annual gross income. Most people are aware of the common medical expenses you may incur over the year, but what if your situation is more unique? Joe Gormley, CPA of Princeton, New Jersey, is an expert at making sure you are claiming all the deductions you are entitled to. If you fit into one of the unusual circumstances below, you may want to consult a professional to claim your deductions.
Surgery
If you received necessary surgery in the previous year, you can claim any out of pocket expenses you paid on your insurance. Typically, you will have significant out of pocket expenses if you have a deductible or coinsurance, or do not have insurance. As long as the surgery is necessary as decided by a doctor, you can claim the expense as a deduction on your income taxes. Lasik eye surgery, although once considered elective, can be claimed as a deduction. Cosmetic surgery is invalid unless medically necessary.
Homeopathic or Natural Doctors
Many people don’t realize that you can deduct expenses for preventative or homeopathic care, such as Chiropractors, Physical Therapists, Dental Care, and even Acupuncture for certain medical reasons.
Cancer
Serious, life-threatening diseases like cancer can be expensive to treat. You can write off any expenses for chemotherapy or radiation, as well as prescription medications to assist with the side effects of treatment or help fight the cancer itself. Wigs are also deductible for cancer patients.
Medical Travel
Since many specialists are located in specific areas, your travel expenses and the travel expenses of your spouse are also deductible. The travel must be necessary to receive treatment or diagnoses for a medical condition. You can claim meals, lodging, and travel expenses such as gas or oil, or airfare.
Care for an elderly parent
If you take care of an elderly parent who lives with you or in a facility where you provide the funding, you can claim them as a dependent and deduct the medical expenses you’ve paid on their behalf throughout the year.
Insomnia
In some cases, if you are having trouble sleeping or have a sleeping condition, your doctor will prescribe a specific bed or mattress. This is actually tax deductible, as long as you have a prescription.
Home Improvements
If you purchased home improvement items which were deemed by a doctor to be medically necessary, you can deduct these expenses from your taxes. A standing bathtub, wheelchair ramp, shower renovation, or stair chair may be covered if you are adding them to make your home handicap accessible or easier for someone who lives there with a disability. You can also deduct improvements that improve the quality of life for the occupants of the home. If you get new siding because the previous siding had mold which caused medical issues, this would be deductible in the medical expense category. In addition, swimming pools can occasionally be deducted if they are installed with the purpose of treating an illness or injury.
Starting a Family
Starting a family can be expensive, and for some more than others. Birth control is deductible as prescription medication. You can also deduct pregnancy tests and fertility treatments, as well as in-vitro fertilization. Once you have a baby, you can deduct breast pumps as a medical expense.
Gluten Free Diet
If you need to switch to a gluten-free diet for health reasons, the IRS will allow you to deduct the difference between a regular diet and gluten-free diet from your medical expenses.
Guide Dogs
If you require a guide dog, the cost of purchasing, training, and maintaining a guide dog is tax deductible.
You are allowed to claim medical deductions for yourself, your spouse, and any dependents. There are many medical deductions you may not have known about. However, making sure you have records to support your deductions and the medical validity of your claims is essential in case of an audit. Your records should contain diagnoses, provider information, appointment information, and the type of treatment received. If you are claiming a non-treatment item, such as a diet, guide dog, or home improvement, you should have recommendations or supporting records from your doctor, as well as receipts and cost records for the item itself.
There is also a credit for paying health insurance premiums on your own called the Health Care Tax Credit. If you elect to take this credit, you can’t take that credit again for the same month, or following months in the tax year. The premium payment has to be similar to the average payment as expected for total charges under the health insurance contract between you and the health insurance company. Before electing this credit, consult Joe Gormley, CPA to determine when the most profitable time to elect this credit would be.
Most people have medical expenses throughout the year. Keeping track of these is just as important as knowing which ones to claim when the time comes. Joe Gormley can help you do both. If you live in Princeton, New Jersey and had any medical expenses last year, consult Joe Gormley, CPA before filing your taxes by clicking the link below.
Joseph J. Gormley CPA