If you have incurred and paid qualified medical and dental expenses for yourself, your spouse, or your dependents, you are eligible to take a deduction for the 2020 tax year if the total of the expenses exceeds 7.5% of your adjusted gross income. Only certain medical and dental expenses are deductible on your income tax returns and you must itemize your deductions on Schedule A to deduct these expenses.
Medical expenses generally include payments for diagnosis, treatment, and prevention of disease. The following lists cover some examples of deductible expenses but are not exhaustive.
Medical Expenses that are Deductible
- Payments of fees to doctors, surgeons, and dentists
- Payments for drugs that require a prescription for use by the individual
- Payments for prescription glasses, contact lenses, and hearing aids
- Payments for insurance premiums you paid that cover medical care or long-term care insurance.
It is important to remember, if you’re an employee, the medical expense portion paid by your employer is not eligible as a deduction on your personal tax returns.
Medical Expenses that are not Deductible
- Payments for nonprescription medicines, toothpaste, toiletries, and cosmetics
- Payments for a trip or program that is “for the general improvement of your health”
- Payments for most cosmetic surgery
You may only include the medical expenses you paid during the year. The total deductible medical expenses must be reduced by any reimbursement received or any reimbursement paid directly to the medical provider. It is important that you retain all payment receipts which will help in determining if the medical expenses paid or incurred are tax deductible.
If you have any questions on determining if your expenses are deductible please contact your Untracht Early advisor.