John M. Hoffman & Associates CPAs

Frequently Asked Tax Questions

Medical Expenses

"I never have enough to claim my medical - under what circumstances might I?"

This could fall under the category of being careful of what you wish for. Most of us hope that we never have enough medical expenses, paid out of our own pocket, to be able to itemize. However the following are examples of circumstances where you might:

A low income year is combined with a high medical year. With that in mind, if you were having a low income year, you might want to get all of that dental work done in that year so you might get a tax benefit.

You planned to get all the medical into one tax year. Most times you can not plan when you are going to need medical but lets say that you had the choice of making one lump sum to the orthodontist for your twin daughters teeth (versus spreading it out over three calendar years). At the same time you figure it is time to replace those ten year old bifocal eye-glasses with Lasik surgery. This could just be good planning if the scenario worked out. I would not recommend the eye surgery unless you really needed it.

Filing separate tax returns from your spouse. Lets say that in a given year, one of the two of you has significant unreimbursed medical. This most frequently occurs with dental or psychiatric needs (as they are often not covered by traditional medical insurance). It might make sense to use the filing option of married filing separately as it would not force the spouse with the medical expenses to need to get over the 7.5% hurdle of both incomes, only their own.

Another situation that often puts people into claiming medical expenses is early (or even normal) retirement. Often times these taxpayers continue with some sort of medical insurance coverage (even if it is just a Medicare supplement). The combination of the health insurance not being deducted elsewhere, the lower income in retirement, and the unreimbursed medical costs at that age often will times result in a taxpayer having adequate medical deductions to get a tax benefit.