Zuazo & Associates

When preparing your taxes, few areas cause as much confusion as medical expense deductions. The IRS does allow you to deduct certain healthcare costs, but the rules about whose expenses qualify and how much can be deducted are not always straightforward.

If you’ve ever wondered whether you can deduct medical bills for your children, aging parents, or even someone you support financially, you are not alone. Many taxpayers miss out on valuable deductions simply because they do not understand the details.

This guide provides a full breakdown of the rules, practical examples, and insights to help you make the most of this deduction.

Why Medical Expense Deductions Matter

Healthcare is one of the largest expenses for families in the United States. According to the Centers for Medicare and Medicaid Services, Americans spent more than $4.5 trillion on healthcare in 2022, averaging over $13,000 per person. With costs continuing to rise, the ability to deduct a portion of those expenses can provide meaningful tax relief.

However, the deduction is not automatic. You need to know whose expenses qualify, track the right documentation, and apply the IRS threshold rules correctly.

The 7.5% of AGI Rule

The IRS requires that medical expenses be deducted only to the extent they exceed 7.5% of your Adjusted Gross Income (AGI).

• If your AGI is $50,000, you must spend more than $3,750 on qualifying medical expenses before you can deduct anything.

• If you spent $6,000, only $2,250 would be deductible ($6,000 - $3,750).

This threshold applies regardless of whether the expenses are for you, your spouse, or someone you support.

Who Qualifies for Deductible Medical Expenses

You can claim medical expenses for four main categories of people:

1. Yourself

This is the simplest case. Any qualifying medical expense you paid for your own healthcare can be included. This may include health insurance premiums you paid out of pocket, prescription drugs, doctor visits, surgeries, and even travel costs for medical appointments.

2. Your Spouse

If you are legally married and file jointly, you can claim expenses for your spouse even if they do not rely on you for support. If you file separately, you may still claim their expenses if you paid for them and they otherwise qualify.

3. Dependents

This is where many taxpayers miss opportunities. A dependent usually falls into one of these groups:

• Qualifying child: Your child under 19 (or under 24 if a full-time student) whom you support.

• Qualifying relative: A relative, such as a parent, sibling, or even grandparent, for whom you provide more than half of their support.

Even if the person lives outside your home, they may still qualify. For example, paying for your mother’s assisted living care may qualify as long as you meet the support test.

4. Certain Non-Dependents You Support

You may be able to claim medical expenses for someone who would have been your dependent but did not qualify due to technicalities. For instance:

• Their income was above the limit for dependents.

• They filed a joint return with their spouse.

As long as you provided more than half of their support, the IRS may still allow you to deduct their medical costs. This rule often applies to adult children supporting elderly parents.

Special Situations to Know About

The IRS rules are not always black and white. Several unique circumstances can change who qualifies:

• Divorced or separated parents: If you are divorced and pay your child’s medical bills, you may deduct those costs, even if your ex-spouse claims the child as a dependent. The deduction goes to the parent who actually paid the expense.

• Multiple support arrangements: When siblings share responsibility for an aging parent’s care, only one sibling can claim the parent as a dependent and deduct the expenses. This may require a signed agreement.

• Adopted children: Adopted children are treated the same as biological children under IRS rules.

• Deceased dependents: If you paid medical expenses for someone who passed away, you can still deduct those expenses if they were your dependent or spouse at the time.
  
  

What Types of Expenses Are Deductible

The IRS allows a wide range of costs, including:

• Doctor and hospital fees

• Surgeries and medical procedures

• Prescription medications and insulin

• Dental and vision care (including eyeglasses and contact lenses)

• Hearing aids and batteries

• Medical travel, including mileage to and from appointments

• Qualified long-term care services and nursing care
  
  

In some cases, home modifications prescribed by a doctor (such as installing ramps or widening doorways) may also qualify.

What Expenses Do Not Qualify

Equally important is knowing what the IRS does not allow. Common nondeductible expenses include:

• Over-the-counter medications (except insulin)

• Cosmetic surgery not medically necessary

• Gym memberships, weight-loss programs, or vitamins (unless prescribed for a diagnosed condition)

• General wellness services such as massage, unless medically prescribed
  
  

Why Careful Recordkeeping Is Critical

Claiming medical deductions requires strong documentation. Keep copies of:

• Bills and receipts from healthcare providers

• Insurance statements showing what was paid or reimbursed

• Proof of payment, such as canceled checks or bank statements

• Mileage logs for trips to medical facilities

Without proper records, deductions may be denied in an audit. A well-organized system also helps you calculate whether you’ve crossed the 7.5% AGI threshold.

Insight: When Medical Deductions Truly Matter

Because of the 7.5% threshold, medical deductions often provide the most value in years of unusually high healthcare costs. For example:

• Families paying for major surgeries or hospitalizations

• Taxpayers covering the costs of long-term care for elderly relatives

• Individuals with chronic illnesses requiring ongoing treatment

In these situations, careful tracking can lead to thousands of dollars in deductions.

How Professional Guidance Can Help

Tax rules surrounding medical expenses are detailed and sometimes confusing. Missteps can lead to missed deductions or costly mistakes. Working with a qualified tax advisor helps ensure you claim everything you’re entitled to without raising red flags with the IRS.

At Zuazo & Associates, we specialize in helping individuals and families navigate complex tax questions, including medical expense deductions. Our team of accountants and tax professionals can review your situation, ensure compliance, and help you maximize savings.

Conclusion

Medical expense deductions are not just about your own costs. You may be able to deduct expenses for your spouse, children, aging parents, or even others you support financially. The key is understanding IRS rules, keeping careful records, and applying the 7.5% AGI threshold correctly.

For families facing high healthcare costs, these deductions can make a real difference. If you are unsure about your eligibility, professional guidance is the safest path. With proper planning, you can take advantage of the deductions available and ease some of the financial burden of healthcare.