With the official opening of the tax season last Friday, we thought it be best to address those popular questions often asked as you are preparing your tax file for 2010.
So what exactly are medical expenses in the eyes of the IRS?
They are those expenses that are for the diagnosis, cure, mitigation, treatment, or prevention of disease. It also includes the cost for treatment for payments for legal medical services rendered by physicians, surgeons, dentists and other medical practitioners.
Also included are the costs for equipment, supplies, and diagnostic devices needed for medical purposes. The premiums you pay for insurance coverage and any amounts paid for transportation to get medical care are deductable. Medical expenses also covers amounts paid for qualified long-term care services.
What does it NOT include?
They do not include expenses that are merely beneficial to general health, such as vitamins or a vacation.
Some other items that cannot be deducted include:
• Diet Foods
• Life Insurance or Income Protection Policies
• Maternity Clothing
• Surgery for purely cosmetic reasons
• toothpaste, toiletries and cosmetics
• nonprescription nicotine gum, patches or lozengers
• nonprescription drugs or medicine
• Teeth whitening
• Hair transplant
Please note that if your doctor has recommended a program as treatment for a specific condition and it is properly documented for expenses such as:
• Health club dues
• social activities such as swimming
• Weight loss program
The IRS has indicated that the cost would be deductable
Of course you will only get these deductions if you itemize on Schedule A and you can only deduct that amount of your medical and dental expenses that is more than 7.5% of your adjusted gross Income
These deductions can be taken for yourself, your spouse and your dependents (the person must have been a dependent either at the time of the medical services were provided or at the time you paid the expense).
When in doubt always ask your tax advisor if the expense is allowable.
