Are Medical Expenses Tax Deductible?

How the 7.5% AGI Rule Determines Your Medical Expense Deduction

So, are medical expenses tax-deductible? Yes, but only the portion that exceeds 7.5% of your adjusted gross income (AGI), and only if you itemize your deductions.

Here’s how it works: the IRS allows you to deduct qualified medical and dental expenses above that 7.5% threshold. Any expenses below it don’t count. Think of the threshold as a minimum you must clear before the deduction kicks in.

Quick example:
If your AGI is $60,000, your threshold is $4,500 (7.5% of $60,000). If you paid $7,000 in qualifying medical expenses, you could deduct $2,500—the amount that exceeds the threshold.

This limitation isn’t unique to medical expenses. Many tax benefits have built-in caps or thresholds to ensure deductions apply to significant out-of-pocket costs rather than routine spending.

One important reminder: this deduction is only available if you itemize on Schedule A. If you take the standard deduction instead, medical expenses won’t reduce your taxable income.

Next Step:
Calculate your AGI, multiply it by 7.5%, and compare that number to your total qualifying medical expenses. If your costs exceed the threshold, itemizing may warrant closer review.

What Medical Expenses Are Tax Deductible?

To claim a medical expense deduction, you first need to identify which expenses are deductible. include:

Some costs are more ambiguous. For instance, health insurance premiums may or may not be considered deductible medical expenses depending on how you paid for them. If you pay for health insurance out-of-pocket, then you can deduct those expenses. If you pay for your premiums through an employer-sponsored plan or pre-tax account, then you cannot deduct them.

Next Step: Do you believe you have qualifying medical expenses that you may be able to deduct on your next return? If so, you should create a spreadsheet and list all qualifying medical expenses. Sum the amounts and compare them to the 7.5% threshold calculated in the step above.

What Does Not Qualify

Not every medical expense qualifies for a tax deduction. For instance, any medical costs related to your overall well-being won’t be included in your qualified expenses. Generally, over-the-counter medications (other than insulin), supplements, vitamins, and general health items don’t qualify as deductible medical expenses.

Medical care expenses that are later reimbursed by insurance or paid from pre-tax accounts, such as a Health Savings Account or an FSA, are not deductible. You also cannot deduct pre-tax contributions to employer-sponsored health insurance plans.

Another type of medical care cost not covered by deductions is cosmetic surgery and optional (non-medically necessary) procedures. Some procedures may require clarification on whether they were medically necessary. For instance, your dentist may recommend that you get false teeth. If your dentist believes those false teeth are medically necessary to prevent disease and uphold the structural integrity of your jaw, then those expenses will qualify. If your dentist believes the false teeth are primarily for cosmetic reasons, they would not be deductible.

So What?: It’s critical to separate qualified from non-qualified medical expenses before you file your return. Otherwise, you could face delays and be required to make corrections on your return. Even worse, an error in your calculations could result in an IRS audit.

Source: IRS Pub. 502, What Expenses Are Not Deductible

How to Calculate Your Deductible Amount

To determine the total sum of your qualified medical expenses and maximize your tax return, you should complete the following steps:

• 1. Add up all the qualifying medical and dental expenses
• 2. Subtract any reimbursements or pre-tax payments
• 3. Multiply your AGI by 0.075 (or 7.5%) to determine your threshold
• 4. Subtract the threshold from the qualified expenses
• 5. Enter the deductible portion of your medical and dental expenses on Schedule A (Form 1040), Line 1. This amount then flows to your Form 1040 as part of itemized deductions. Self-employed individuals should use Line 17 to report their self-employed health insurance deduction as well

So What?: Following these steps accurately will ensure you get the most out of your next tax return.

Should You Itemize Medical Expenses or Take the Standard Deduction?

Is it worth claiming your medical expenses on your tax return? The answer to that question depends on your specific circumstances because you can only accept either a standard deduction or use itemized deductions. You can’t claim both. That said, you will need to calculate which amount is higher.

For Tax Year 2025 (returns filed in 2026), the standard deduction amounts are:

• Filing as Single: $15,750
• Filing as Married Filing Jointly: $31,500
• Filing as Head of Household: $23,625

To calculate your Schedule A deductions, start by determining how much of your qualified medical expenses exceed the 7.5% of AGI threshold. However, medical expenses alone rarely push you past the standard deduction. The real advantage comes from taking a holistic approach—combining that excess medical amount with other itemizable deductions such as property taxes, mortgage interest, and charitable contributions.

When these combined deductions exceed the standard deduction, it becomes more beneficial to itemize. In other words, medical expenses often work best as part of a broader strategy to “beat” the standard deduction—not as a standalone deduction.

Next Step: Determine whether a standardized deduction or an itemized deduction is best for you by calculating which sum is higher.

Source: How the Big Beautiful Bill Impacts Taxpayers

Special Cases and Exceptions

Some medical expenses are subject to special exceptions. Long-term care insurance premiums are deductible only up to age-based limits and only as part of total medical expenses that exceed 7.5% of AGI. These limits must match the IRS-published amounts for the tax year.

• 40 and under: $480
• 41 to 50: $900
• 51 to 60: $1,800
• 61 to 70: $4,810
• 71 and over: $6,020

You can include qualifying medical expenses for dependents if you paid for them, and you can also include the qualifying medical expenses for a deceased spouse while filing their final tax return.

Another unique case that may result in an exemption is when you’ve been affected by a natural disaster. For a full list of all the disaster relief and tax provisions that impact various states, check out the IRS Disaster Announcements page.

Pub 502 goes over in detail everything you need to know about itemizing deductions for medical and dental expenses that you claim. It also explains exactly which medical expenses qualify for a deduction and the various special cases and exceptions that may apply.

Next Step: If you think you qualify for a special case exemption, then it’s worth investigating your options to maximize your tax situation.

Source: Long-Term Care Premium Limits

Numeric Example

Let’s say a taxpayer has an adjusted gross income of $80,000. They have qualified medical expenses totaling $10,000.

To calculate their threshold, you would use the following formula: $80,000 x 7.5% = $6,000.

Then, you’ll calculate the eligible deductible amount with this formula: $10,000 - $6,000 = $4,000.

In other words, the taxpayer can claim up to $4,000 in tax deductions for their qualified medical expenses.

So What?: Use this numeric example to help guide you in your own calculations.

Are Medical Expenses Tax Deductible?

Medical expenses can be deducted when they exceed 7.5% of AGI, and you itemize deductions on Schedule A. Understanding what qualifies ensures you don’t miss a valuable deduction.

Use our Medical Expenses Tax Deductible Flowchart to see which of your expenses count and how much you can claim this year.