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Start planning now if you’d like to deduct medical expenses

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 — but only to the extent that they exceed 10% of
your adjusted gross income.

Before 2013, the floor was only 7.5% for regular tax purposes. (Taxpayers age
65 and older can still enjoy that 7.5% floor through 2016. The floor for AMT
purposes, however, is 10% for all
taxpayers, the same as it was before 2013.)

By “bunching” nonurgent medical procedures and other controllable expenses into
alternating years, you may increase your ability to exceed the new 10% 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 the 10% floor or exactly what expenses are deductible? Ask
us!

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