Medical and dental care gets more expensive every year. Health insurance helps defray your costs, but benefits don’t generally improve to make up the difference. Can you catch a break by claiming them on your income taxes? Yes, but only if they constitute at least 7.5% of your adjusted gross income (AGI). We’re here to walk you through which medical expenses you can claim and how.
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Which Medical Expenses Qualify for a Tax Deduction?
The IRS defines medical care expenses as those you incur “…primarily to alleviate or prevent a physical or mental disability or illness.” It would be easier to list all the medical costs that aren’t deductible than those that are. A few expenses that aren’t are cosmetic surgery, health club fees, nonprescription drugs, and veterinary bills (as is often the case with the IRS, there are some exceptions to these). IRS Publication 502 lists what you can deduct (see the section, What Medical Expenses Are Includible?). Some of them might surprise you, such as:
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Acupuncture
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Birth control pills
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Capital expenses (improvements made to a home to accommodate a person with a disability)
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Contact lenses and eyeglasses (if necessary for medical reasons)
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Lead-based paint removal
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Medical supplies like bandages and personal protective equipment
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Transportation costs (related to medical situations)
There’s a lot more. Read through the complete list if you think your health-related expenses for 2024 were excessive.
Where Do You Report Medical Expenses?
If you’re filing a return with a spouse and/or dependents, you need to report your family’s total unreimbursed medical costs on Schedule A (for Form 1040), along with your other itemized deductions. You won’t know what 7.5% of your AGI will be until you prepare your taxes, of course, unless you experienced a catastrophic event whose expenses will obviously meet the 7.5% threshold. However, if you didn’t keep track of your medical expenses last year, you have to do a lot of digging.
When you file your taxes, the IRS doesn’t require you to submit any documentation for your medical costs. In fact, there’s only one line on your Schedule A for medical and dental expense totals. You add that number to your other itemized deductions and report it on one line on Form 1040. The trouble is that you need to have some sort of documentation for each expenditure in case the IRS decides to audit you down the road.
Where Should You Look for Medical Documentation?
If you didn’t track medical expenses throughout 2024, you have a big challenge ahead. You’ll probably have to consult several sources to come up with a list of what you spent. Here are some places to try:
Your Doctor’s or Dentist’s Office
Did you save receipts when you visited your doctor’s or dentist’s office and submitted a copay or cash payment? Depending on how high-tech the offices are, you might be able to get a printout of your expenses for the year. If you paid cash and insurance reimbursed you, be sure to claim only the uncovered portion.
Your Pharmacy
Here again, depending on the types of records your pharmacy makes available, you might be able to ask for a complete list of what you paid all year. It’s also possible that any online pharmacy access you have will include the amounts you paid out of pocket.
Your Health Insurance Provider
Some health insurance companies send monthly statements of your medical and pharmaceutical claims. If yours doesn’t, you might have access to them online. Usually, you can find detailed records of claims there.
Your Checking Account and Credit Card Statements
If you haven’t kept receipts and other documentation this year and you had a lot of medical expenses that you think you can claim, you have to go through your bank account and credit card statements.
Your Online or Physical Retailer Accounts
If you bought deductible medical supplies from online or brick-and-mortar retailers, try to get verification of what you spent there and for what. You might have to call their customer support phone lines, and you might or might not get a physical printout from them. This is why saving all medical receipts is so critical.
How Can You Organize Your Medical Expenses for 2025 Taxes?
Not everyone knows ahead of time whether they will have excessive medical expenses throughout the year. So, whether or not you think they will amount to 7.5% of your AGI, start collecting and storing everything related to your health care as early as possible in the year. As you might imagine, reconstructing a year’s worth of personal payments, as described above, takes an enormous amount of time. The task is much easier if you do this as you go.
If you’re not using software to track your income and expenses, either create a paper system or make a spreadsheet. Keep track of everything that comes from a medical source. Use file folders or large envelopes to store receipts and statements. If you have electronic versions of them, set up folders on your PC. If you use a spreadsheet, create columns for date, payee, amount, and expense type (more on that in a bit). And add a column for notes so that you can write the reason for the expense. Keep all the original files or receipts for at least three years.
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Can Personal Finance Apps Help With Your Medical Expenses?
Besides being less error-prone, recordkeeping is far easier and faster if you set up an account with a personal finance app. These allow you to connect your online bank accounts and import your checking and credit card transactions. Then, it’s just a matter of reviewing those transactions regularly and ensuring that your healthcare costs correspond to the correct category so you can run reports to use during tax preparation.
Credit: Monarch/PCMag (Categorized transaction in Monarch)
Not every financial application geared toward individuals and small businesses comes with a category labeled Medical or Health Care, though you have the option to add one in Monarch, Rocket Money, Quicken Simplifi, and Quicken Classic, for example. Quicken Simplifi even has built-in subcategories like Dental, Eyecare, and Pharmacy under the main Health category. Rocket Money allows you to indicate whether a transaction is tax-deductible with a toggle.
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Does Tax Prep Software Help You Organize Medical Expenses?
Tax software helps you report your health-related costs and encourages you to find every deductible dollar. As it walks you through the section that deals with deductions, it asks about what you spent on health care, providing fields for subtotals by expense type, like Doctor Expenses and Hospital Expenses. Because these websites base everything on the IRS tax code and continuously calculate your tax liability, they will tell you whether you’ve hit the 7.5% threshold and can claim a deduction for medical expenses. You only have to tell them what you spent.
Credit: FreeTaxUSA/PCMag (Medical expense page in FreeTaxUSA)
If you make a simple spreadsheet that contains your medical expenses (or have something similar on paper), you’ll need to create categories for your spending based on the expense types you see in your tax software. Your spreadsheet will then display totals for all the appropriate categories. For example, put all the expenses for prescription medications together in one group and all your hospital spending in another. That way, you can calculate these subtotals easily and copy them into your tax software.
Credit: H&R Block/PCMag (Medical expenses calculation in H&R Block)
Careful Work Can Save You Money
If someone in your family has an expensive health condition or your spouse and children incur medical and dental costs frequently, tracking your tax-deductible claims will take time and careful organization. That one line on Schedule A can have excruciating detail behind it. Only small business expenses rival it in terms of a bookkeeping challenge. But you may leave a sizable deduction on the table if you’re eligible and don’t do the work to claim it.
For more on tax prep, see our story on how to get the largest tax refund possible.
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About Kathy Yakal
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