Keeping track of your medical expenses during the year has its benefits come tax time because of the tax deductions for medical expenses. Medical expenses include not only doctor bills, but also dental and vision care expenses. Knowing the different medical expense tax write-offs helps you minimize your tax bill.
Self-Employed Health Insurance
If you're self-employed, you can claim a deduction for medical and qualified long-term care insurance without itemizing on your tax return. You can include the premiums you pay for yourself, your spouse, your dependents and your children who are under 27 at the end of the year. However, if you have access to health insurance through either your employer or your spouse's employer, you can't claim this deduction. In addition, any costs used for this deduction can't be used a second time for the itemized medical expenses deduction.
If you're not self-employed, you're not out of luck completely, but you'll have a harder time claiming a deduction. The general medical and dental expenses deduction includes all qualified medical and dental expenses, not just insurance premiums. For example, you can include costs of treatment, preventative care, surgery and prescription drugs. You can also include the transportation costs of going to medical care, such as the mileage driving to and from the hospital. These costs can be for yourself, your spouse or your dependents.
The medical and dental expenses deduction requires that you itemize your deductions. In addition, you can only deduct the amount of your qualifying medical and dental expenses that exceeds the threshold. Through the 2012 tax year, the threshold is 7.5 percent of your adjusted gross income, but in 2013 and later tax years, the threshold increases to 10 percent. For example, if you have an adjusted gross income of $70,000 in 2013, you can only deduct your expenses that exceed $7,000.
You generally can't include elective procedures such as cosmetic surgery as part of the deduction, unless the procedures correct a genetic deformity or an injury from an accident or illness. You also can't deduct any costs for which you are reimbursed or costs for which your insurance pays. For example, if you pay $2,000 for surgery but your insurer reimburses you, you can't deduct those expenses. You also can't include funeral costs, non-prescription drugs or general personal items, such as toothpaste or shampoo.
Mark Kennan is a writer based in the Kansas City area, specializing in personal finance and business topics. He has been writing since 2009 and has been published by "Quicken," "TurboTax," and "The Motley Fool."