Summertime is here, have you taken a look at your medical expenses recently? You should.
Taxpayers under 65 with itemized deductions can deduct medical expenses that exceed 10 percent of their adjusted gross income (AGI) for the year. For those 65 and older, the mark is 7.5 percent of AGI.
So, why should you check now?
It’s about the halfway point in the year. You can add up your costs for insurance premiums, doctor visits, prescription medications and more, and see if you might be on track to hit or come close to the 10-percent mark by year’s end. This tax organizer can help.
Close doesn’t count on tax returns
If you think you’re close, but need a little something extra to get you over the hump, it may be wise to schedule that dental cleaning, colonoscopy, or some other test you’ve been dreading. You’ve got to do these things at some point, so why not this year when they could get you a tax break?
Think about it. How many times have you sat down with your tax preparer and realized that, although you and your family had quite a few medical expenses, you were just under the deductible limit? If you had paid attention earlier in the year and prepared for tax season, you may have been able to change that dynamic.
Surprising medical expense deductions
- Body scans
- Breast pumps and supplies
- Christian Science Practitioner
- Contact Lenses and Eyeglasses
- Fertility enhancement
- Lead-based paint removal
- Pregnancy test kits
- Weight-loss program (when necessary to treat a diagnosed disease)
If you’re unsure of other medical and dental expenses that qualify, check out IRS Publication 502.
Timing does count
Along with scheduling medical procedures, you might consider timing certain payments for 2015 instead of 2016. Say, for example, you visit your doctor in December, but your bill isn’t due until January. It makes sense to make the payment by December 31, so you can include it in your medical expenses for this year. Same goes if you buy eyeglasses or have medically necessary work done on your home, such as ramps installed for wheelchair access.
If you don’t think you’re going to hit the 10-percent threshold this year, you may want to put off those medical procedures until next year, if that’s OK with your doctor. And, there’s no need to expedite bill payment this year, if payment will help decrease your tax liability next year.
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