Question for the Money Doctors
Question submitted on Apr 26, 2010.
QuestionI have recently been diagnosed with cancer and want to know if I can deduct medical expenses for treatments.
Generally speaking yes. According to the IRS definition of medical expenses, "Medical expenses are the costs of diagnosis, cure, mitigation,
One caveat is medical expenses are subject to 7.5% of adjusted gross income (AGI), meaning that you can only deduct medical expenses that are more than 7.5% of AGI. I.e. If your AGI is $100,000, you can deduct medical expenses that exceed 7.5% of $100,000, or $7,500.
An alternative to this is if you have an eligible High deductible health plan and can contribute to a health savings account (HSA). If so, you can contribute to the HSA, which has maximum limits of $3,050 for employee only coverage in 2011 and $6,150 for family coverage. The contributions to the HSA are deductible and reimbursements or payments from the HSA for medical expenses are tax free.
Best wishes on your treatment and recovery.
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