Should I add up my medical expenses?

Medical expenses are not like charitable contributions. Your deduction is not equal to every dollar you spent on medical expenses like it is when you give money away to charitable organizations. Medical expenses only start counting towards your itemized deductions when they exceed 10% of your adjusted gross income (7.5% for age 65 or older).

Here’s an example… say your adjusted gross income (AGI) is $100,000 and you had $10,500 in medical expenses. The first $10,000 in medical expenses (10% of $100,000 AGI) would go nowhere and only $500 would come through as a deduction. Basically, the first $10,000 would only get you to the starting point and anything beyond that would count as a deduction. If you had less than $10,000 in medical expenses, that would mean no medical deduction at all.

Because of the high threshold, many people are unable to take a deduction for their out-of-pocket medical expenses. So, if you know you definitely did not have more than 10% of your adjusted gross income in medical expenses, you should save yourself the time and forget adding them up. And if you know you take the standard deduction rather than itemizing, that’s another reason not to add them up.

Aleya Veach

Hi I'm Aleya!