2023 Tax Calendar
VIEWpoint Issue 2 | 2022
Inflation Reduction Act: Highlights of Key Changes for You and Yo...
Medical expenses that aren’t reimbursable by insurance or paid through a tax-advantaged account (such as a Health Savings Account or Flexible Spending Account) may be deductible as part of your tax accounting strategy — but only to the extent that they exceed 10 percent of your adjusted gross income.
Before 2013, the floor was only 7.5 percent for regular tax purposes. Taxpayers age 65 and older can still enjoy that 7.5 percent floor through 2016. The floor for AMT purposes, however, is 10 percent for all taxpayers, the same as it was before 2013.
By “bunching” non-urgent medical procedures and other controllable expenses into alternating years, you may increase your ability to exceed the new 10 percent floor. Controllable expenses might include prescription drugs, eyeglasses and contact lenses, hearing aids, dental work and elective surgery.
If it’s looking like you’re close to exceeding the floor this year, consider accelerating controllable expenses into this year. But if you’re far from exceeding it, to the extent possible (without harming your health), you might want to put off medical expenses until next year, in case you have enough expenses in 2014 to exceed the floor.
Have questions about deducting medical expenses as part of your tax accounting strategy? Contact Doeren Mayhew’s CPAs in Michigan, Houston or Ft. Lauderdale.
This publication is distributed for informational purposes only, with the understanding that Doeren Mayhew is not rendering legal, accounting, or other professional opinions on specific facts for matters, and, accordingly, assumes no liability whatsoever in connection with its use. Should the reader have any questions regarding any of the news articles, it is recommended that a Doeren Mayhew representative be contacted.
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