Beginning tax year 2018, you may claim the medical and dental expenses as an itemized deduction. Only the medical and dental expenses that are over 7.5% (0.075) of your adjusted gross income (AGI) may be claimed as an itemized deduction.
Example: Your adjusted gross income is $100,000. Your medical and dental expenses total $10,000. Only the amount over 7.5% of your adjusted gross income, $7,500 will be used for this credit. Therefore, you could claim $2,500 of the $10,000 medical and dental expenses. This amount, $2,500 is the amount over the 7.5% of your adjusted gross income ($10,000 minus $7,500).
To enter your expenses in the program, go to:
- Federal Section
- Enter Myself
- Itemized Deductions
- Medical and Dental Expenses – enter the total expenses here and the program will calculate the expenses allowed taking into consider 7.5% threshold for your AGI.
For 2017 tax year and prior, you could claim the expenses that exceeded 7.5% of your adjusted gross income. The 7.5% AGI threshold had expired but was enacted by Congress on December 22, 2017 by the Tax Reform Act of 2017. The threshold changed the amount you could claim which was the excess over 10% of AGI to the excess over 7.5% of AGI for 2017 and 2018.
The 7.5% threshold is only through tax year 2018 unless a change is applied by law for the threshold to remain at 7.5%.
NOTE: With the signing of the Tax Cuts and Jobs Act, the standard deductions increased, and personal exemptions were suspended. Your total itemized deductions must be more than the standard deduction before it will override the standard deduction.