Medical and Dental Expenses

New 2/19/12

Itemization required

You must itemize on Form 1040, Schedule A to deduct qualifying medical and dental expenses.

Deduction limited

Only the amount that exceeds 7.5% of your adjusted gross income (“AGI”) for the year can be deducted.

When paid

Expenses must have been paid in the year for which the return is being filed, regardless of when services were provided.

Receipts

You will need to have good receipts or records to substantiate your expenses.

Expenses reimbursed not deductible

Medical expenses reimbursed to you or directly to the doctor or hospital cannot be deducted.

Whose expenses are deductible

You may deduct qualified medical expenses paid for:

  • yourself
  • your spouse and
  • your dependents.

Some exceptions and special rules apply to divorced or separated parents, taxpayers with a multiple support agreement, or those with a qualifying relative who is not your child.

What expenses

You can deduct expenses:

  1. primarily paid for diagnosis, cure, mitigation, treatment or prevention of disease
  2. treatment affecting any structure or function of the body
  3. prescription medication and insulin
  4. premiums for medical, dental insurance
  5. some long-term care insurance, and
  6. starting in 2011, lactation supplies.

Transportation costs

You may deduct transportation costs primarily for and essential to medical care that qualifies as medical expenses, including:

  1. the actual fare for a taxi, bus, train, plane or ambulance
  2. tolls and parking fees, and
  3. for use of your automobile, based on:
    • actual out-of-pocket car expenses such as gas and oil, or
    • the standard mileage rate for medical expenses, which is 19¢ per mile for 2011.

Tax-favored saving for medical expenses

Distributions from Health Savings Accounts and withdrawals from Flexible Spending Arrangements may be tax free if used to pay qualified medical expenses, including prescription medication and insulin.

For additional information see :

both available at www.irs.gov, or by calling 800-TAX-FORM (800-829-3676).