Medical Expense Deductions: What Can You Claim on Your Taxes in 2025?

Navigating the world of taxes can feel complex, but understanding key deductions can lead to significant savings. One of the most valuable but often misunderstood areas is medical expense deductions. These deductions provide crucial tax benefits for medical expenses, allowing you to lower your taxable income and potentially increase your tax refund. If you’ve faced substantial health-related costs, knowing how to claim medical expenses properly is essential. This article will break down everything you need to know, from what qualifies to how to file, ensuring you’re fully equipped for the 2025 tax season.

1. What Are Medical Expense Deductions?

So, what are medical expense deductions exactly? In simple terms, they are costs you’ve paid for the diagnosis, cure, treatment, mitigation, or prevention of a physical or mental illness. The primary purpose of the tax deduction for medical expenses is to provide financial relief to individuals and families who bear significant healthcare costs. When you claim these deductions, you reduce your adjusted gross income (AGI), which is the income amount the government uses to determine your tax liability.

A critical rule to remember is the AGI threshold. For the 2025 tax year, you can only deduct qualified medical expenses that exceed 7.5% of your AGI. This means if your AGI is $60,000, you can only begin deducting medical costs after they surpass $4,500 (7.5% of $60,000). Any deductible medical expenses above that amount can be subtracted from your income.

2. Who Can Claim Medical Expense Deductions?

Understanding medical expense deductions eligibility is the first step to claiming them. Not everyone can take this deduction. Here are the main criteria:

• You Must Itemize: The most important rule is that you must choose to itemize your deductions on your tax return instead of taking the standard deduction. You’ll use Schedule A (Form 1040) to list out all your itemized deductions, including medical costs. This is only beneficial if your total itemized deductions (including medical expenses, state and local taxes, mortgage interest, etc.) are greater than your standard deduction amount.
• Exceed the 7.5% AGI Threshold: As mentioned, your unreimbursed medical expenses must total more than 7.5% of your AGI.
• Whose Expenses Qualify? You can claim expenses for yourself, your spouse, and any dependents you claim on your tax return. This includes children, elderly parents, or other qualifying relatives who rely on you for support.

3. What Medical Expenses Are Deductible?

The IRS has a comprehensive list of medical expenses that you can and cannot claim. It’s crucial to know the difference to avoid errors. Here is a breakdown of the main medical expense deduction categories.

Deductible Medical Expenses Include:

• Doctor’s Visits and Hospital Care: This includes payments to physicians, surgeons, specialists, and other medical practitioners. Fees for hospital stays, including meals and lodging provided for medical care, are also deductible.
• Prescription Medications: The cost of any medicine prescribed by a doctor is deductible. This also includes insulin.
• Medical Insurance Premiums: You can deduct the premiums you pay for policies that cover medical care, including health, dental, and qualified long-term care insurance. However, you cannot deduct premiums paid by your employer or those paid with pre-tax dollars.
• Dental and Vision Care: This is a broad category. It includes payments for dental treatments like cleanings, fillings, braces, and dentures. For vision, you can deduct the cost of eye exams, prescription glasses, and contact lenses.
• Long-Term Care Costs: You can deduct the costs of qualified long-term care services for a chronically ill individual. Premiums for long-term care insurance are also deductible up to certain age-based limits. For 2025, these limits are:
  • Age 40 or less: $480
  • Age 41 to 50: $900
  • Age 51 to 60: $1,800
  • Age 61 to 70: $4,810
  • Age 71 or over: $6,020
• Medical Equipment: Costs for durable medical equipment like wheelchairs, crutches, hearing aids, and artificial limbs are deductible.
• Transportation Costs: The cost of travel primarily for and essential to medical care is deductible. This includes using your own car (at a rate of 21 cents per mile for 2025), bus fare, or ambulance services.
• Therapy and Rehabilitation: Payments for physical therapy, psychiatric care, and other therapeutic treatments for a medical condition are deductible.

Non-Deductible Expenses:

It’s equally important to know what you can’t claim on taxes. Generally, expenses for overall wellness are not deductible. This includes cosmetic surgery (unless to correct a deformity), over-the-counter medications (except insulin), vitamins, health club memberships, and funeral expenses.

4. How to Calculate and Track Your Medical Expenses for Deductions

Properly calculating and tracking your expenses is non-negotiable.

Calculating Your Deduction:

Here’s a simple guide on how to calculate medical deductions:

1. Sum Your Expenses: Add up all your qualified, unreimbursed medical expenses for the year.
2. Find Your AGI: Locate your Adjusted Gross Income on your Form 1040.
3. Calculate the Threshold: Multiply your AGI by 7.5% (0.075).
4. Subtract the Threshold: Subtract the result from step 3 from your total medical expenses in step 1. The remaining amount is your deductible amount.

Example:

• Your AGI: $80,000
• Your Total Medical Expenses: $9,000
• Your AGI Threshold: $80,000 x 0.075 = $6,000
• Your Deduction: $9,000 – $6,000 = $3,000

You can deduct $3,000 on your Schedule A.

[Infographic: 4 Steps to Calculate Your Medical Deduction] A simple 4-panel visual guide showing each step of the calculation with icons: a calculator for summing expenses, a tax form for AGI, a percentage sign for the threshold, and a final number for the deduction amount.

Tracking Expenses:

The medical deductions IRS rules require diligent record-keeping.

• Keep Everything: Save all receipts, bills from doctors, pharmacy printouts, and statements from your insurance company showing what was and wasn’t covered.
• Use Tools: Use tax tools for medical expenses like a simple spreadsheet, a dedicated folder, or a budgeting app to log costs as they occur. This prevents a frantic search for documents at tax time.
• Hold Onto Records: The IRS recommends keeping tax records for at least three years from the date you filed your original return, in case of an audit.

5. How to Claim Medical Expenses on Your Tax Return

Once you’ve determined you’re eligible and have calculated your deduction, it’s time to file.

• Itemize on Form 1040: To claim medical deductions, you must itemize. This means you will not take the standard deduction.
• Use Schedule A: You will report your total medical expenses on Schedule A (Form 1040), Itemized Deductions. The form will guide you through the calculation, including the 7.5% AGI limitation.
• Ensure Accuracy: Double-check your math and ensure you’re only including qualified, unreimbursed expenses. Accuracy is key to avoiding delays or questions from the IRS.
• File Early: If you anticipate a significant refund due to high medical costs, consider filing your return as early as possible to get your money sooner.

6. Common Mistakes to Avoid When Claiming Medical Expense Deductions

Taxpayers often make preventable medical expense claim mistakes. Here are a few to watch out for:

• Claiming Non-Qualified Expenses: One of the biggest IRS medical deduction errors is trying to deduct costs for general health, like gym memberships or non-prescription vitamins.
• Forgetting the 7.5% AGI Threshold: You cannot deduct your total medical bill, only the portion that exceeds 7.5% of your AGI.
• Including Reimbursed Expenses: You can only deduct out-of-pocket costs. If your insurance company or employer reimbursed you for an expense, it is not deductible.
• Lacking Documentation: Failing to keep receipts and records is a major mistake. If the IRS questions your deduction, you’ll need proof.

To avoid tax errors, review the IRS Publication 502, keep meticulous records, and consider using tax software or a professional to guide you.

7. Can You Claim Medical Expenses for a Dependent?

Yes, you can claim medical expenses for dependents. The IRS allows you to include medical costs you paid for your spouse and anyone you claim as a dependent, such as your children or an elderly parent living with you.

The dependent must meet the IRS criteria for a qualifying child or qualifying relative. You’ll need the same documentation for their expenses as you do for your own. This is a valuable way to meet the 7.5% AGI threshold, especially if you are covering significant medical expenses for elderly parents or have high medical deductions for children.

8. What If You Don’t Have Enough Medical Expenses to Itemize?

Many people wonder, what if medical expenses aren’t enough to exceed the AGI threshold or their total itemized deductions aren’t more than the standard deduction? In this case, taking the standard deduction vs. itemizing is the better choice.

The standard deduction is a flat-dollar, no-questions-asked amount that you can subtract from your AGI. For 2025, the standard deduction amounts are projected to be substantial, ranging from $15,750 for single filers to $31,500 for those married filing jointly. If your total itemized deductions are less than this amount, you will save more money by taking the standard deduction. You can still achieve a tax benefit without itemizing through this simplified method.

9. How Medical Expense Deductions Affect Your Tax Refund

Claiming a significant medical expense deduction directly lowers your taxable income. A lower taxable income means you owe less tax, which can result in a larger tax refund from medical expenses. The impact of medical deductions on taxes can be substantial, especially for those with high healthcare costs in a given year.

Furthermore, lowering your AGI through this deduction might help you qualify for other tax credits or deductions that have income limits. It’s an important part of overall tax planning for medical costs.

Check this video for more info.

10. Frequently Asked Questions (FAQs)

Here are answers to some common tax questions about medical expenses:

• Can I deduct my health insurance premiums?Yes, you can deduct premiums for medical, dental, and qualified long-term care insurance that you pay for with after-tax dollars.
• What if I paid for medical expenses with my HSA or FSA?You cannot deduct expenses paid for with funds from a Health Savings Account (HSA) or Flexible Spending Arrangement (FSA), as those funds are already tax-advantaged.
• Are dental and vision expenses deductible?Yes, they are considered qualified medical expenses and are fully deductible, subject to the 7.5% AGI rule.
• Can I deduct medical expenses if I was reimbursed by insurance?No. You can only deduct expenses that were not paid back to you by insurance or any other source.
• What happens if I don’t have enough to itemize?You should take the standard deduction. It’s a simpler process and will likely result in a lower tax bill if your itemized deductions are below the standard deduction amount.

Conclusion

Understanding how to claim medical expenses is a powerful tool for effective tax planning for medical costs. By knowing what qualifies, diligently tracking your spending, and correctly filing your return, you can maximize your medical deductions and secure valuable medical tax benefits. Remember to keep all your receipts and consult IRS Publication 502 for detailed rules. For personalized advice, especially with complex situations, consider speaking with a qualified tax professional to ensure you get every deduction you deserve.

Sources

• IRS Topic No. 502 Medical and Dental Expenses
• IRS Publication 502
• IRS Medical, Nursing Home, Special Care Expenses
• IRS Medical Expenses for People with Disabilities
• NerdWallet Medical Expense Tax Deduction
• TurboTax Can I Claim Medical Expenses on My Taxes
• VSP Direct Are Glasses Tax Deductible
• AALTCI 2025 Tax Deductible Limits for Long-Term Care Insurance
• Everlance Medical Mileage Rate
• Investopedia 20 Medical Expenses You Didn’t Know You Could Deduct
• Sycamore Hills Dentistry Deductible Dental Expenses