The law makes it difficult for itemizers to deduct medical expenses. To reap any write-off, you must pay bills that aren't covered by insurance, reimbursed by employers or otherwise satisfied by, for example, a company-sponsored plan to which employees contribute pretax dollars that can be used to pay medical charges. But an understanding of the rules and the workarounds can help you maximize the deductions.
First of all, understand that for 2014, the big limitation is that those outlays are allowable only for the portion that tops 10 percent of your AGI. For individuals 65 and up, the nondeductible floor remains 7.5 percent through 2016. You stand little chance of a break at filing time for medical costs unless your reportable income is modest or you incur unusually high medical expenses—for instance, because of uninsured surgery, severe chronic disease or a catastrophic illness. Even within these restrictions, however, there are some useful strategies.
About Julian Block
Attorney and author Julian Block is frequently quoted in the New York Times, Wall Street Journal, and the Washington Post. He has been cited as “a leading tax professional” (New York Times), an “accomplished writer on taxes” (Wall Street Journal), and “an authority on tax planning” (Financial Planning magazine). More information about his books can be found at julianblocktaxexpert.com.