It is commonly known that may be able to deduct your medical expenses for the year; but the question becomes – which ones and how much?
First it is important to know deducting specific medical expenses only applies to taxpayers who are itemizing their deductions versus using the standard deduction. Next; you may deduct only deduct medical expenses that exceed 7.5% of your adjusted gross income.
In general you may be able to deduct expenses you paid during the tax year for medical and dental care for yourself, your spouse, and your dependents. Medical care expenses include payments for the diagnosis, cure, mitigation, treatment, or prevention of disease, or payments for treatments affecting any structure or function of the body. While there are many things you can deduct, you may not deduct funeral or burial expenses, nonprescription medicines, toothpaste, toiletries, cosmetics, a trip or program for the general improvement of your health, or most cosmetic surgery. You also can’t deduct amounts paid for nicotine gum and nicotine patches that do not require a prescription.
Keep in mind you can only deduct the medical expense you paid during the year. Expenses paid for you by a friend, parent, or other person does not qualify. This also means you’ll have to subtract all reimbursements received including those paid on your behalf to the doctor, hospital, or other medical provider.
A Special Note for Self-Employed Persons: If you’re self-employed and have a net profit for the year, you may be eligible for the self-employed health insurance deduction. This is an adjustment to income, rather than an itemized deduction, for premiums you paid on a health insurance policy covering medical care, including a qualified long-term care insurance policy for yourself, your spouse, and dependents. The policy can also cover your child who is under the age of 27 at the end of 2020 even if the child wasn’t your dependent.
For additional information on medical expenses such as who qualifies as your dependent for purposes of this deduction or how to figure out your adjusted gross income call Mrs. Joette Claud at (757)( 793-7325 for a FREE consultation TODAY