Nobody likes to get sick. To make matters worse, health care can be expensive. To help defray some of these costs, you may be able to take a personal tax deduction for some of your out-of-pocket medical expenses, including medical-related transportation and travel costs.
How Much & What Can You Deduct?
First of all, you can deduct your medical expenses only if you itemize your personal deductions on Schedule A of your tax return. You should itemize only if your total personal deductions exceed the standard deduction for the year. These personal deductions include not just your medical expenses (subject to the percentage limits discussed below), but also things like home mortgage interest and property taxes, state income taxes, charitable contributions, and several others. You can use Schedule A (or tax preparation software) to determine whether or not you should itemize.
If you do itemize, you may deduct your medical expenses, including medical transpiration costs, only if and to the extent your total expenses exceed 10% of your adjusted gross income (AGI) for the year. The threshold is 7.5% of AGI if you’re over 65 years of age through 2016—for 2017 and later the 10% threshold applies to everyone. For example, if your AGI is $100,000, you may deduct your medical expenses on Schedule A only to the extent they exceed $10,000 (10% x $100,000 = $10,000). If you have $12,000 in medical expenses, you could deduct $2,000. If you’re over 65, you could deduct $4,500 for 2016, but only $2,000 in 2017 and later.
Fortunately, for tax purposes, medical expenses include many things, including health and dental insurance premiums you pay yourself, co-pays and deductibles, prescription drugs, dental, optometric and chiropractic care, and most other health related expenses. For a detailed list, see IRS Publication 502, Medical and Dental Expenses. Moreover, you can generally include medical-related travel and transportation costs, as well as some of the costs for lodging and meals while traveling for medical treatment.
Cost of Transportation
Transportation and travel costs are generally deductible as a medical expense if they're needed to reach a medical treatment facility. These include travel costs to a doctor’s office, hospital, or clinic where you, your spouse, or dependents receive medical care. They also include the costs of visiting a mentally ill dependent, if the visits are recommended as a part of treatment.
However, transportation costs incurred by choice and not by necessity aren't deductible. For example, if you decide to travel to a distant location for an operation that could easily be performed in your area, the transportation costs aren't deductible. You also can't deduct:
- going to and from work, even if your condition requires an unusual means of transportation,
- travel that's just for the general improvement of your health or morale, even if it's recommended by your doctor, or
- the costs of operating a specially equipped car for other than medical reasons.
Transportation costs you can deduct include:
- car expenses
- parking and toll fees
- bus, taxi, train, or plane fares
- ambulance service fees
- your expenses for accompanying your child while getting medical care, and
- the costs of a nurse or technician who can give injections, medications, or other treatment needed by you or family member while traveling to get medical care.
Your medical-related driving costs can be calculated in one of two ways: using your actual expenses, or the standard medical mileage rate. If you use the actual expense method, you can only the deduct the cost of gas and oil, and any repair costs incurred while driving for medical reasons. You cannot include depreciation, insurance, general repair, or maintenance expenses. If you use the standard medical mileage rate, you don't deduct your actual costs for gas and oil. Instead, you may deduct 19 cents per mile you drive for medical treatment in 2016. For example, if you use the standard medical rate and drive 1,000 miles for medical treatment in 2016, you’d get a $190 deduction to add to all your other deductible medical expenses for the year. You can also deduct your parking fees and tolls. Whichever method you use, you must keep track of your mileage while driving for medical treatment.
Cost of Meals
You can deduct the cost of meals at a hospital or similar facility if a main reason for being there is to get medical care. You can't include in medical expenses the cost of meals that aren't part of inpatient care. For example, you can’t deduct meals you pay for while traveling to a hospital or other medical facility.
Cost of Lodging
Lodging costs you incur while traveling out of town are deductible if:
- the lodging is primarily for, and essential to, medical care
- the medical care is provided by a doctor in a licensed hospital or in a medical care facility
- the lodging isn't extravagant
- there's no significant element of personal pleasure, recreation, or vacation in the travel away from home.
However, this deduction is limited to a maximum of $50 per night for each person. You can include lodging for a person traveling with the person receiving the medical care-for example, if a parent is traveling with a sick child, up to $100 per night can be deducted.
Questions for Your Attorney
- Is there a limit or cap on the amount of medical expenses I can deduct?
- Can I use or carryover to next year any medical expenses I can't deduct on this year's return?
- Are travel and lodging expenses deductible if I travel to see a certain specialist if there are doctors practicing the same specialty in my city?