With medical costs increasing all the time, many taxpayers are looking for ways to maximize their tax savings on medical expenses. Per the 2010 health care law, taxpayers under age 65 can deduct medical expenses that surpass 10% of their adjusted gross income. (Taxpayers who are 65 or older can still use the previous 7.5% threshold through the 2016 tax year. After that, they too will be subject to the new 10% threshold.)
For example, if you make $100,000 and have $12,000 in deductible medical expenses, you would be able to claim $2,000 of that on line 4 of Schedule A. One thing to keep in mind, however, is that you can’t double-dip. Amounts paid with pre-tax dollars, such as medical premiums through your employer, and any amounts for which you were reimbursed are not deductible.
If you find that your out of pocket expenses are close to the threshold amount, you will want to carefully track every expense, as they can add up. Here are some tips to make sure you are tracking all your possible deductions:Read More