If you itemize deductions on your tax return, you may wonder: What medical expenses can I include? The IRS recently issued some frequently asked questions addressing when certain costs are qualified medical expenses for federal income tax purposes.
You can claim an itemized deduction for qualified medical expenses that exceed 7.5% of your adjusted gross income. You can also take tax-free health savings account (HSA), health care flexible spending account (FSA) or health reimbursement account (HRA) withdrawals to cover qualified medical expenses. However, qualified medical expenses don’t include those for things that are merely beneficial to your general health.
The answers to the IRS FAQs clarify the following points, starting with the ones we think are most interesting.
If you meet or are close to the threshold to deduct medical expenses, you want to count every one that’s eligible. Be sure to save documentation and we can evaluate expenses when we prepare your tax return.