Medical Expenses & Health Tax Deductions: 2025 Guide

What Counts as a Deductible Medical Expense?

Before you can claim a medical expense tax deduction, you need to know what the IRS actually considers a qualified medical expense.

In IRS Publication 502, medical expenses are defined as costs paid for the diagnosis, cure, mitigation, treatment, or prevention of disease, or for affecting any part or function of the body.

Many health-related costs improve your well-being, but only expenses primarily meant to treat, prevent, or diagnose a medical condition qualify for a deduction. For example, vitamins wouldn’t be considered a medical expense, but a prescription pill would be deductible.

Here are a few examples of things that would be considered deductible medical expenses under IRS Pub 502:

• Prescription medication
• Bills paid to doctors, dentists, surgeons, psychologists, and other licensed health professionals for services rendered
• Laboratory fees and X-rays
• Necessary equipment like eyeglasses, contact lenses, or wheelchairs
• Personal protective equipment, such as masks or gloves, when used primarily to prevent or treat a diagnosed medical condition and not for general public health purposes
• Alcohol or drug treatment
• Special educational services for children with learning disabilities
• Premiums paid for medical, dental, and vision insurance

Source: IRS Pub. 502, What Medical Expenses are Includible

On the flip side, here are a few examples of things that do not qualify as a deductible medical expense under IRS Pub 502:

• Vitamins
• Reimbursed expenses
• Cosmetic surgery
• Membership fees to gyms or health clubs
• Diet food or health drinks
• Hygiene products
• Elective procedures
• Funeral or burial costs
• Future medical payments

Next Steps: Keep solid records of any medical expenses you incur throughout the year and document those expenses as deductions on your next tax return.

The 7.5% AGI Rule: How Much You Can Actually Deduct

While taxpayers can deduct medical expenses, the medical expense deduction is limited. According to IRS Schedule A Instructions, taxpayers can only deduct dental and medical expenses that exceed 7.5% of that person’s Adjusted Gross Income as reported on IRS Form 1040 or IRS 1040-SR, line 11.

Put simply, your medical expenses must exceed 7.5% of your adjusted gross income (AGI) before any deduction kicks in. Let’s say you have an AGI of $100,000. That same year, you paid $8,000 in medical expenses. 7.5% of $100,000 equals $7,500. That said, you’d only be able to deduct $500 in medical expenses.

When you claim medical deductions, they will only be available if you itemize on Schedule A (Form 1040).

So What?: You will need to calculate your adjusted gross income before you determine how much you’re able to deduct in medical expenses. You can find your AGI on line 11 of Form 1040.

Are Health Insurance Premiums Deductible?

Per IRS Pub 502, health insurance premiums can be tax-deductible, but it depends on how the premiums were paid. Whether your health insurance costs are tax deductible will depend on factors such as whether you paid the premiums out of pocket, through a pre-tax payroll plan, or for a qualified long-term care insurance policy.

For example, employer-sponsored pre-tax premiums are already excluded from your taxable income, so you cannot deduct them a second time. Premiums paid with after-tax dollars may be deductible as itemized medical expenses. Separately, eligible self-employed taxpayers may deduct qualifying health insurance premiums as an adjustment to income on Schedule 1, without itemizing.

• Deductible: COBRA premiums, Medicare premiums (Parts B, C, D), qualified long-term care insurance (within IRS limits), out-of-pocket private insurance premiums, and premiums paid by self-employed taxpayers for their own coverage
• Non-deductible: Employer-sponsored pre-tax premiums, premiums paid using an HSA or other pre-tax account

Next Step: Determine whether your health insurance premiums were paid with pre-tax or after-tax dollars to see if they qualify for a deduction. Because these rules can get complicated, speaking with a tax professional can help you confirm your eligibility.

Source: IRS Schedule 1 Instructions

How Pre-Tax Health Benefits Affect Your Medical Tax Deductions

There are several ways pre-tax payroll deductions can be used to fund medical expenses. For one, pre-tax payroll deductions may be used to fund health insurance premiums through employee contributions to an employer-sponsored plan. These types of pre-tax health benefits are not deductible on your tax return because tax benefits have already been conferred, since those funds are never included in the taxpayer’s gross income.

HSA contributions may be deductible or excluded from income, depending on how they’re made. FSA contributions are pre-tax through payroll and are not separately deductible. These, along with Health Reimbursement Arrangements (HRA), are all considered tax-advantaged medical accounts.

The main advantage HSAs offer is that contributions reduce taxpayers’ overall taxable income, and all withdrawals for qualified expenses are tax-free. Taxpayers should use Form 8889 (Health Savings Accounts) to report HSA contributions and calculate HSA deduction amounts.

Source: IRS Pub. 969

Comparison Chart: HSA vs. FSA vs. HRA Tax Benefits

For 2025, the HSA contribution limits are $8,300 for family coverage and $4,150 for self-only coverage, as adjusted annually by the IRS. The FSA contribution limit is set annually by the IRS, but employer plans may impose lower caps.

Do you have more questions about HSAs, HRAs, or medical savings account benefits? IRS Pub 969 is an in-depth resource guide for taxpayers interested in learning more about health savings accounts, medical savings accounts, health flexible spending arrangements, and health reimbursement arrangements.

Next Step: Determine whether you qualify for tax deductions based on your contributions to tax-advantaged accounts like HSAs, FSAs, or HRAs.

Source: IRS Rev. Proc. 2024-25

Which Medical Expenses are Commonly Deductible?

Are medical expenses tax deductible? Per the IRS, medical expenses that exceed 7.5% of your adjusted gross income and that are itemized on Schedule A (Form 1040) are tax deductible.

Some of the most common medical expenses that are deducted include:

• Doctor or hospital lab fees
• Prescription medication
• Costs of insulin
• Medical travel deductions
• Medically necessary surgeries (LASIK, IVF)
• Dental expenses
• Costs of medical equipment (hearing aids, wheelchairs, service animals)
• Chiropractic and acupuncture costs for pain treatment
• Vision (testing and eyeglasses).

It’s important to identify which medical expenses are not deductible to avoid errors on your returns. For instance, elective procedures or cosmetic surgeries are typically not deductible unless they’re also medically necessary.

According to a recent IRS press release, the Internal Revenue Service had no choice but to assess over $162 million in penalties for false tax credit claims that were promoted on social media. Many taxpayers believed they could claim the Sick and Family Leave Credit and the Fuel Tax Credit, even though they did not qualify. Never assume a social media post or online article can fully inform you regarding your eligibility for certain credits and deductions. It’s better to consult IRS guidance and resources, or trusted sources like our team here at FileTax.com, for answers.

For a full list and explanation of what is considered a qualified medical expense under IRS rules, check out IRS Pub 502.

Why This Matters: Identifying which medical care expenses are tax-deductible can help you maximize your tax savings.

Is Claiming Medical Expenses Worth It

Whether it’s worth claiming medical expenses depends on your overall tax picture. Sometimes, taking the standard deduction provides a greater benefit. In other cases, itemizing can reduce your taxable income more effectively, especially if you have substantial unreimbursed medical expenses.

To determine which approach works best, it’s important to track your medical expenses throughout the year.

In general, you should itemize only if your total allowable itemized deductions, including medical expenses, mortgage interest, state and local taxes, charitable contributions, etc., exceed the standard deduction for your filing status. Here’s a comparison table for 2025:

To claim your medical expenses, you must keep documentation and proof of the costs you paid. This includes pharmacy records, receipts, invoices, and Explanation of Benefits (EOBs). For a full list of eligible medical expenses, refer to the IRS Schedule A Instructions.

Next Step: Create a simple, year-round tracking system for your medical expenses. Staying organized now will make filing easier and help ensure you don’t miss deductions in future tax years.

How to Claim Medical Deductions on Your Return

To claim medical deductions on your return, start by gathering all receipts and documentation for any unreimbursed medical expenses you paid throughout the year. Keep in mind that only certain contributions to tax-advantaged accounts—such as after-tax HSA contributions reported on Form 8889—may be deductible; contributions to FSAs or HRAs are already pre-tax and cannot be claimed as itemized medical deductions.

Tip: Keep a yearly log of deductible medical expenses to simplify next year’s filing.

Next, calculate both your total medical expenses and your adjusted gross income (AGI). Medical expenses are deductible only to the extent they exceed 7.5% of your AGI.

If your eligible expenses exceed the 7.5% threshold, enter the total amount of your medical expenses on Schedule A (Form 1040), Line 1. The form will automatically calculate how much of your expenses are deductible.

Be sure to subtract any pre-tax benefits, such as employer-sponsored pre-tax premiums or any reimbursed amounts, since these cannot be deducted.

IRS Pub 502 provides detailed guidance on which medical expenses qualify and how to report them correctly on your return.

What This Means for Your Taxes: Following these steps helps ensure you receive all medical deductions you’re entitled to. Don’t miss out on tax benefits by overlooking eligible expenses or incorrectly applying the 7.5% AGI rule.

When Medical Events Unlock Additional Tax Relief

In some situations, medical events or other hardships can qualify you for tax relief. For example, if you missed your filing deadline due to a serious illness or another circumstance outside of your control, you may qualify for penalty abatement based on reasonable cause. This relief does not extend your filing deadline, but it may remove or reduce penalties after the fact if you can show evidence such as medical records or hospitalization dates.

Taxpayers affected by federally declared natural disasters should also review the IRS’s disaster tax relief options. In these cases, the IRS may automatically extend filing deadlines, waive penalties, or offer other forms of relief depending on the scope of the disaster and the taxpayer’s location.

Additional tax considerations may apply when handling medical expenses or final returns after the death of a spouse, as the IRS provides specific rules for filing final returns, claiming certain deductions, and determining eligibility for special filing statuses.

If you think your situation may qualify for special tax treatment or relief, visit the IRS Disaster Relief Announcements page or consult a tax professional for guidance.

Next Step: Identify any special relief programs or exceptions that may apply to your situation and claim them when preparing your return.

Medical Expenses and Tax Deductions

Major medical expenses can create major tax opportunities. After reading through this guide, you should have a better idea of what qualifies as a medical expense under IRS guidelines and how to claim these valuable tax deductions.

Understanding these rules may help you determine whether itemizing medical expenses could reduce your taxable income, depending on your situation. Not sure where to start? Use our Health Tax Relief Flowchart to see what expenses qualify, then follow the Medical Expense Checklist to get organized before filing with FileTax.com.