Which Medical Expenses Are Tax-Deductible?
On your tax return, you can deduct “qualified, unreimbursed medical expenses” that are more than 7.5 percent of your adjusted gross income (AGI). To figure out your AGI, take your gross income and subtract allowances for personal deductions and itemized deductions. So if your AGI is $65,000, you would multiply it by .075 to find that any medical expenses over $4,875 can be deducted.
According to the IRS, you may be able to deduct health care costs pertaining to the diagnosis, treatment, or prevention of a disease for yourself, your spouse, or a dependent. If that seems vague, the IRS lists eligible medical and dental expenses on its website, which include but are not limited to:
- Fees paid to doctors and other medical specialists
- Inpatient hospital or nursing home care
- Inpatient treatment for drug and alcohol abuse
- Prescription drugs
- False teeth, contacts, glasses, hearing aids, and wheelchairs
- Transportation to medical appointments
- Home improvements to accommodate medical conditions, such as widening a doorway for a wheelchair
- Health insurance premiums
Do Medical Alert Systems Qualify as a Medical Expense?
As you can see in the above list, medical alert systems don’t stand out as something that can be deducted on your tax return. However, if you search on a page called Publication 502, Medical and Dental Expenses under “What Medical Expenses Are Includible,” there’s a qualifying category called “Medical Information Plan Expenses” that may be missed without talking to a tax expert.
The Medical Information Plan includes expenses paid to keep health information in a data bank that can be readily made available to medical providers. Since some medical alert systems, such as Bay Alarm Medical, track and store health information that emergency responders can use, they are beneficial to a patient’s medical care—and thus are partially tax-deductible. Keep in mind that only those medical alert systems that monitor and store health data will qualify.
Also remember that, if your unreimbursed medical expenses don’t exceed 7.5 percent of your AGI, you won’t be able to deduct your medical alert system.
Is It Worth It To Claim My Medical Expenses?
If your medical alert system is tax-deductible, it’s always best to calculate whether filing an itemized return makes more sense than filing a standard return. To benefit from medical expense deductions, your total itemized deductions—medical expenses, state and local taxes, home mortgage interest and charitable contributions—will need to be greater than your available standard deduction.
The following standard deduction amounts for the 2021 tax year will give you an idea of what to expect if you don’t itemize your tax return.