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Can I claim that? Common and Unusual Medical Deductions

Can I claim that?  Common and Unusual Medical Deductions

Deductions are some of the most complicated and sometimes confusing advantages you can claim on your taxes.  Claiming a large amount of deductions can entitle you to a huge reduction in your taxable income, resulting many times in a larger refund, and at least a reduction in what you owe the IRS and State.  Knowing what can be deducted and what cannot is a detailed science.  One of the most common deductions when itemizing are medical expenses.  While some of these may seem obvious, there are some deductions you probably never would have guessed you would be able to claim!  At BMS in Bakersfield, California, experts can help you determine how best to organize your deductions, and what you can and cannot claim.

             

Claiming medical expenses does require that you spent a significant amount of money for deductible medical items.  If you are under 65, you can only deduct as many medical expenses as will exceed 10% of your income for the tax year.  So, if you made $20,000.00, and spent $3,000.00 on medical expenses, you would be able to claim $1,000.00.  However, if you only spent $1,000.00, as significant as that may be to you, none of it is deductible.  If you are over 65, or your spouse is, you can deduct medical expenses that exceed 7.5% of your income.  If you used a Health Savings Account or Flexible Spending Arrangement to pay for medical expenses, you cannot claim a tax deduction for these.  They are already tax-free.

You can include you, your spouses, and your dependents medical expenses.  You can also include medical expenses for those who would be your dependent were it not for certain guidelines.  To confirm these, contact BMS by clicking the link at the end of this article.

The medical deductions you can typically claim include:

      -Travel costs for medical care:  If you have paid for an ambulance service or transportation to and from appointments, you can claim mileage or fees. 

      -Fees:  Copays, doctor fees, dental fees, surgery payments, specialist payments

      -Hospital Fees

      -Insurance premiums for medical and hospital care

      -Prescription payments

      - Medical Equipment:  Wheelchairs, stair equipment, crutches, and other medical equipment or aids are deductible.

            There are cases where you may not be sure if a medical expense is deductible.  There are unusual circumstances which are coverable that may be unexpected.  Some of these include:

  • Bed or mattress to help with sleeping (if prescribed by a doctor).
  • Improvements to make your home handicap accessible, or to add features which make it easier for someone with a disability, such as standing bathtubs, shower renovations, stair chairs.
  • Wigs prescribed for anxiety over hair loss
  • Wigs for cancer patients
  • Chemotherapy
  • New siding if the previous siding had mold which caused suffering
  • Remedial reading help for dyslexia
  • Herbal supplements (only if prescribed by a doctor)
  • Hearing aid batteries
  • Difference in pricing between organic or gluten free diets and regular diet
  • Lasik Eye Surgery
  • In-Vitro fertilization
  • A swimming pool for treating illness or injury
  • Hormone therapy
  • Pregnancy Tests
  • Braille Books
  • Quit smoking programs
  • Alcoholism:  You can include expenses for a treatment program for alcoholism, including inpatient care or transportation to and from Alcoholics Anonymous meetings.

Despite the availability of these deductions, guidelines are strict and each medical deduction you claim requires proof in case of an audit or request from the Internal Revenue Service for more information.  CASM recommends that you keep records which indicate the amounts of each payment, date of visit and payment, a description of the medical care provided, the name and address of the provider, who received care, and the purpose of the expense. 

            Items which are not deductible include non-prescription drugs, toothpaste, gym fees, vitamins, diet food (besides the gluten free), non-prescription nicotine, and medical expenses paid in previous years.

            If you paid premiums for qualified health insurance in 2014 or 2015, you may be able to claim the Health Care Tax Credit for one or both years.  You will have to elect to take the credit.  Once you elect to take the credit for the month, you can’t take that credit again for the same month, or following months in the tax year.  You can only treat an amount as paid for insurance for yourself and your family members if the charges were separately stated in the contract, the amount you paid isn’t more than the charge stated in the contract, and the amount in the contract by the insurance company isn’t unreasonably large.  For example, if you for some reason had to pay triple the premium for one month, you cannot choose that month to claim the credit.  The payment has to be similar to the average payment as expected for total charges under the contract.

            If you feel that you could claim medical expenses for 2015, and are located in or around Bakersfield California, contact BMS today by clicking the link below.

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