Wealth Finance

In Part 2 of this multi-part series, we look at deductible medical expenses, which are detailed inIRS Publication 502, “Medical and Dental Expenses.”

• Do deduct premiums for the Medicare Part D prescription drug insurance program, as well as other health-insurance premiums you pay yourself. The premiums for long-term-care insurance are deductible on a sliding scale according to your age.

• Do deduct gas mileage expenses for your car when used for medical reasons. The 2010 rate for such deductions was 16.5 cents per mile.

• Do read the IRS list of deductible medical and dental expenses in IRS Publication 502. The following costs, for example, are deductible to the extent they address a health issue: wigs recommended by a doctor for mental health of a patient suffering hair loss due to disease; special mattresses and bed boards; back supports; elastic hosiery; childbirth classes, and remedial reading instruction for dyslexic children.

• Dont expect much. You can only deduct unreimbursed medical and dental expenses that exceed 7.5 percent of your adjusted gross income. If you are subject to the Alternative Minimum Tax, the floor is higher: 10 percent. (If youre self-employed, your health-insurance premiums may be 100 percent deductible. See Publication 502 for eligibility criteria.)

Similar Posts:

• Maximize Medicare’s Benefits
• Health Savings Account (HSA) Basics
• Health reform helps add 2.5 million young adults to insured ranks
• Kids may be priceless, but the cost of raising one is anything but
• Tax Deductions Tips for Individual Real Estate Investors