That way, you'll maximize your medical expenses, increasing the amount that's over 10% of your AGI and ultimately increasing the total itemized amount you'll be able to deduct on your tax return. This is important if you're planning ahead too: If you know that you're anticipating substantial medical expenses, it might be a good idea to also go ahead and get those dental implants or LASIK that you've been considering (assuming you can swing it financially) and have everything done in the same year. If you purchased your own health insurance (on an after-tax basis) and you're not self-employed, you can include the premiums you paid in your total medical expenses when you're determining how much you'll be able to claim as an itemized deduction). In general, the criteria are fairly broad - most reasonable expenses can be included, as long as you paid them yourself using after-tax funds.Ī key part of this decision is that you have to itemize your deductions in order to deduct medical expenses (note that if you're self-employed and you purchased your own health insurance, you can deduct the premiums you paid without itemizing your deductions, using Line 29 of Form 1040 Schedule 1. IRS Publication 502 will help you figure out what counts as an eligible medical expense. That leaves you with $5,750 that you can deduct. You're allowed to deduct your medical expenses that exceed that limit, so you have to subtract $3,750 from your $9,500 total. ![]() How much can you deduct? First, you calculate 7.5% of $50,000, which is $3,750. So what does that mean in terms of dollars and cents? Let's say your total medical expenses in 2023 were $9,500 and your AGI was $50,000. ![]() You can only deduct medical expenses that are more than a 7.5% of your adjusted gross income (AGI). ![]() Medical expenses can be deducted on your tax return if you itemize your deductions, but the specifics have changed a bit over the last several years.
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