When considering your tax deductions, most people think about the same things: business lunches, travel expenses, office equipment. Did you know that you may also be able to deduct health care expenses?
According to the IRS website, starting on January 1st 2013, you were able to deduct any amount of medical expenses that exceed 10% of your adjusted gross income. That means, if you made $100.00 in 2013 and had $11.00 in medical expense, you’d have one dollar in medical deductions, and so on. There’s also a limited exemption until 2017: If you or your spouse are over the age of 65, the expenses need only exceed 7.5% percent of your annual income.
Also of note, if you are self-employed, you may be able to deduct health care premiums.
What sort of things aren’t deductible? You cannot deduct any medications or supplements that weren’t prescribed by a doctor. Gym memberships or over-the-counter smoking cessation tools, for example — although healthy — do not count as a health deductions. If you were reimbursed, of course, that’s not a deduction because there was no loss. The IRS also won’t recognize the majority of non-vital cosmetic procedures (and, most likely, neither did your insurance).
According the IRS website, other items which may be covered include false teeth, eyeglasses, wheelchairs, and even guide dogs.
Last but not least, save the receipts from the gas station or train fare on the way to the doctor. These can be deducted just like they would if you were on the way to a client meeting. Meals, however, cannot. Looks like that fast food lunch you regret grabbing on the drive over to the doctor’s office is still going to be out of pocket.
Of course, all of this can be tricky, so if you have any questions, it’s best to consult a tax professional.
For more information, visit http://www.irs.gov/taxtopics/tc502.html