Medical Expenses and the IRS: Helping the Uninsured

The health care crisis! Millions of Americans are without health care. That’s millions of American’s who can’t go to the doctor or can’t get the prescription drugs that they need. What’s worse is many Americans wait until they’re so sick they have to go to the emergency room and come away with an obscenely large debt to the hospital.

Help for some…While there are low income insurance and prescription plans, many Americans are left to their own devices when it comes to health coverage. But there is something that can give you some sort of relief. You can deduct your medical costs from your income tax return.

What the IRS can do… This can be a lifesaver if you have a hospital bill or you have multiple prescriptions that you need. And here’s how it works.



The formula… You can claim any legitimate medical expenses that are more than 7.5% of your gross income. For example, you made $25,000 last year. You multiply $25,000 by 7.5% or .075 and get $1875. That means you can claim, as a deduction, any medical expenses over $1875. Depending on how much your medical expenses were for the year that can be a savings of anywhere from $100 to $1000.

What are legitimate medical expenses? Anything that is medically necessary is a legitimate expense; that includes surgery, cancer care, or even going to your regular doctor for a cold. Non legitimate expenses are any kind of cosmetic work done.

A broken system… Health insurance is getting more and more expensive. Premiums and deductibles are getting so high that it’s almost not worth paying for insurance. While being able to claim your medical expenses as deductions on your tax return won’t erase your medical debt, it does offer some small amount of comfort.

Now you have the smoking gun…Use it!

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