Table of Contents
- What Are Medical Expenses?
- What Expenses Can You Include This Year?
- How Much of the Expenses Can You Deduct?
- Whose Medical Expenses Can You Include?
- What Medical Expenses Are Includible?
- Annual Physical Examination
- Artificial Limb
- Artificial Teeth
- Birth Control Pills
- Body Scan
- Braille Books and Magazines
- Breast Pumps and Supplies
- Breast Reconstruction Surgery
- Capital Expenses
- Christian Science Practitioner
- Contact Lenses
- Dental Treatment
- Diagnostic Devices
- Disabled Dependent Care Expenses
- Drug Addiction
- Eye Exam
- Eye Surgery
- Fertility Enhancement
- Founder's Fee
- Guide Dog or Other Service Animal
- Health Institute
- Health Maintenance Organization (HMO)
- Hearing Aids
- Home Care
- Home Improvements
- Hospital Services
- Insurance Premiums
- Intellectually and Developmentally Disabled, Special Home for
- Laboratory Fees
- Lactation Expenses
- Lead-Based Paint Removal
- Learning Disability
- Legal Fees
- Lifetime Care—Advance Payments
- Long-Term Care
- Medical Conferences
- Medical Information Plan
- Nursing Home
- Nursing Services
- Organ Donors
- Physical Examination
- Pregnancy Test Kit
- Psychiatric Care
- Special Education
- Stop-Smoking Programs
- Vision Correction Surgery
- Weight-Loss Program
- What Expenses Are Not Includible?
- Baby Sitting, Childcare, and Nursing Services for a Normal, Healthy Baby
- Controlled Substances
- Cosmetic Surgery
- Dancing Lessons
- Diaper Service
- Electrolysis or Hair Removal
- Flexible Spending Account
- Funeral Expenses
- Future Medical Care
- Hair Transplant
- Health Club Dues
- Health Coverage Tax Credit
- Health Savings Accounts
- Household Help
- Illegal Operations and Treatments
- Insurance Premiums
- Maternity Clothes
- Medical Savings Account (MSA)
- Medicines and Drugs From Other Countries
- Nonprescription Drugs and Medicines
- Nutritional Supplements
- Personal Use Items
- Swimming Lessons
- Teeth Whitening
- Veterinary Fees
- Weight-Loss Program
- How Do You Treat Reimbursements?
- How Do You Figure and Report the Deduction on Your Tax Return?
- Sale of Medical Equipment or Property
- Damages for Personal Injuries
- Impairment-Related Work Expenses
- Health Insurance Costs for Self-Employed Persons
- COBRA Premium Assistance
- Health Coverage Tax Credit
- How To Get Tax Help
Medical expenses are the costs of diagnosis, cure, mitigation, treatment, or prevention of disease, and the costs for treatments affecting any part or function of the body. These expenses include payments for legal medical services rendered by physicians, surgeons, dentists, and other medical practitioners. They include the costs of equipment, supplies, and diagnostic devices needed for these purposes.
Medical care expenses must be primarily to alleviate or prevent a physical or mental defect or illness. They do not include expenses that are merely beneficial to general health, such as vitamins or a vacation.
Medical expenses include the premiums you pay for insurance that covers the expenses of medical care, and the amounts you pay for transportation to get medical care. Medical expenses also include amounts paid for qualified long-term care services and limited amounts paid for any qualified long-term care insurance contract.
You can include only the medical and dental expenses you paid this year, regardless of when the services were provided. (But see Decedent under Whose Medical Expenses Can You Include, for an exception.) If you pay medical expenses by check, the day you mail or deliver the check generally is the date of payment. If you use a “pay-by-phone” or “online” account to pay your medical expenses, the date reported on the statement of the financial institution showing when payment was made is the date of payment. If you use a credit card, include medical expenses you charge to your credit card in the year the charge is made, not when you actually pay the amount charged.
If you did not claim a medical or dental expense that would have been deductible in an earlier year, you can file Form 1040X, Amended U.S. Individual Income Tax Return, for the year in which you overlooked the expense. Do not claim the expense on this year's return. Generally, an amended return must be filed within 3 years from the date the original return was filed or within 2 years from the time the tax was paid, whichever is later.
You cannot include medical expenses that were paid by insurance companies or other sources. This is true whether the payments were made directly to you, to the patient, or to the provider of the medical services.
Generally, you can deduct on Schedule A (Form 1040) only the amount of your medical and dental expenses that is more than 10% of your AGI. But if either you or your spouse was born before January 2, 1949, you can deduct the amount of your medical and dental expenses that is more than 7.5% of your AGI.
You can generally include medical expenses you pay for yourself, as well as those you pay for someone who was your spouse or your dependent either when the services were provided or when you paid for them. There are different rules for decedents and for individuals who are the subject of multiple support agreements. See Support claimed under a multiple support agreement , later under Qualifying Relative.
You can include medical expenses you paid for your spouse. To include these expenses, you must have been married either at the time your spouse received the medical services or at the time you paid the medical expenses.
Mary received medical treatment before she married Bill. Bill paid for the treatment after they married. Bill can include these expenses in figuring his medical expense deduction even if Bill and Mary file separate returns.
If Mary had paid the expenses, Bill could not include Mary's expenses in his separate return. Mary would include the amounts she paid during the year in her separate return. If they filed a joint return, the medical expenses both paid during the year would be used to figure their medical expense deduction.
This year, John paid medical expenses for his wife Louise, who died last year. John married Belle this year and they file a joint return. Because John was married to Louise when she received the medical services, he can include those expenses in figuring his medical expense deduction for this year.
You can include medical expenses you paid for your dependent. For you to include these expenses, the person must have been your dependent either at the time the medical services were provided or at the time you paid the expenses. A person generally qualifies as your dependent for purposes of the medical expense deduction if both of the following requirements are met.
You can include medical expenses you paid for an individual that would have been your dependent except that:
He or she received gross income of $3,900 or more in 2013,
He or she filed a joint return for 2013, or
You, or your spouse if filing jointly, could be claimed as a dependent on someone else's 2013 return.
A qualifying child is a child who:
Is your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, half brother, half sister, or a descendant of any of them (for example, your grandchild, niece, or nephew),
Under age 19 at the end of 2013 and younger than you (or your spouse, if filing jointly),
Under age 24 at the end of 2013, a full-time student, and younger than you (or your spouse, if filing jointly), or
Any age and permanently and totally disabled,
Lived with you for more than half of 2013,
Did not provide over half of his or her own support for 2013, and
Did not file a joint return, other than to claim a refund.
The child is in the custody of one or both parents for more than half the year,
The child receives over half of his or her support during the year from his or her parents, and
The child's parents:
Are divorced or legally separated under a decree of divorce or separate maintenance,
Are separated under a written separation agreement, or
Live apart at all times during the last 6 months of the year.
A qualifying relative is a person:
Who is your:
Son, daughter, stepchild, or foster child, or a descendant of any of them (for example, your grandchild),
Brother, sister, half brother, half sister, or a son or daughter of any of them,
Father, mother, or an ancestor or sibling of either of them (for example, your grandmother, grandfather, aunt, or uncle),
Stepbrother, stepsister, stepfather, stepmother, son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law, or
Any other person (other than your spouse) who lived with you all year as a member of your household if your relationship did not violate local law,
Who was not a qualifying child (see Qualifying Child, earlier) of any taxpayer for 2013, and
For whom you provided over half of the support in 2013. But see Child of divorced or separated parents , earlier, Support claimed under a multiple support agreement, next, and Kidnapped child under Qualifying Relative in Publication 501.
You and your three brothers each provide one-fourth of your mother's total support. Under a multiple support agreement, you treat your mother as your dependent. You paid all of her medical expenses. Your brothers repaid you for three-fourths of these expenses. In figuring your medical expense deduction, you can include only one-fourth of your mother's medical expenses. Your brothers cannot include any part of the expenses. However, if you and your brothers share the nonmedical support items and you separately pay all of your mother's medical expenses, you can include the unreimbursed amount you paid for her medical expenses in your medical expenses.
Medical expenses paid before death by the decedent are included in figuring any deduction for medical and dental expenses on the decedent's final income tax return. This includes expenses for the decedent's spouse and dependents as well as for the decedent.
The survivor or personal representative of a decedent can choose to treat certain expenses paid by the decedent's estate for the decedent's medical care as paid by the decedent at the time the medical services were provided. The expenses must be paid within the 1-year period beginning with the day after the date of death. If you are the survivor or personal representative making this choice, you must attach a statement to the decedent's Form 1040 (or the decedent's amended return, Form 1040X) saying that the expenses have not been and will not be claimed on the estate tax return.
John properly filed his 2012 income tax return. He died in 2013 with unpaid medical expenses of $1,500 from 2012 and $1,800 in 2013. If the expenses are paid within the 1-year period, his survivor or personal representative can file an amended return for 2012 claiming a deduction based on the $1,500 medical expenses. The $1,800 of medical expenses from 2013 can be included on the decedent's final return for 2013.
Following is a list of items that you can include in figuring your medical expense deduction. The items are listed in alphabetical order.
This list does not include all possible medical expenses. To determine if an expense not listed can be included in figuring your medical expense deduction, see What Are Medical Expenses , earlier.
You can include in medical expenses amounts you pay for an inpatient's treatment at a therapeutic center for alcohol addiction. This includes meals and lodging provided by the center during treatment.
You can also include in medical expenses amounts you pay for transportation to and from Alcoholics Anonymous meetings in your community if the attendance is pursuant to medical advice that membership in Alcoholics Anonymous is necessary for the treatment of a disease involving the excessive use of alcoholic liquors.
See Physical Examination , later.
You can include in medical expenses the amount you pay for birth control pills prescribed by a doctor.
You can include in medical expenses the part of the cost of Braille books and magazines for use by a visually impaired person that is more than the cost of regular printed editions.
You can include in medical expenses the cost of breast pumps and supplies that assist lactation.
You can include in medical expenses the amounts you pay for breast reconstruction surgery, as well as breast prosthesis, following a mastectomy for cancer. See Cosmetic Surgery , later.
You can include in medical expenses amounts you pay for special equipment installed in a home, or for improvements, if their main purpose is medical care for you, your spouse, or your dependent. The cost of permanent improvements that increase the value of your property may be partly included as a medical expense. The cost of the improvement is reduced by the increase in the value of your property. The difference is a medical expense. If the value of your property is not increased by the improvement, the entire cost is included as a medical expense.
Certain improvements made to accommodate a home to your disabled condition, or that of your spouse or your dependents who live with you, do not usually increase the value of the home and the cost can be included in full as medical expenses. These improvements include, but are not limited to, the following items.
Constructing entrance or exit ramps for your home.
Widening doorways at entrances or exits to your home.
Widening or otherwise modifying hallways and interior doorways.
Installing railings, support bars, or other modifications to bathrooms.
Lowering or modifying kitchen cabinets and equipment.
Moving or modifying electrical outlets and fixtures.
Installing porch lifts and other forms of lifts (but elevators generally add value to the house).
Modifying fire alarms, smoke detectors, and other warning systems.
Adding handrails or grab bars anywhere (whether or not in bathrooms).
Modifying hardware on doors.
Modifying areas in front of entrance and exit doorways.
Grading the ground to provide access to the residence.
Only reasonable costs to accommodate a home to a disabled condition are considered medical care. Additional costs for personal motives, such as for architectural or aesthetic reasons, are not medical expenses.
|Instructions: Use this worksheet to figure the amount, if any, of your medical expenses due to a home improvement.|
|1.||Enter the amount you paid for the home improvement||1.|
|2.||Enter the value of your home immediately after the improvement||2.|
|3.||Enter the value of your home immediately before the improvement||3.|
|4.||Subtract line 3 from line 2. This is the increase in the value of your home due to the improvement||4.|
|• If line 4 is more than or equal to line 1, you have no medical expenses due to the home improvement; stop here.|
|• If line 4 is less than line 1, go to line 5.|
|5.||Subtract line 4 from line 1. These are your medical expenses due to the home improvement||5.|
John has arthritis and a heart condition. He cannot climb stairs or get into a bathtub. On his doctor's advice, he installs a bathroom with a shower stall on the first floor of his two-story rented house. The landlord did not pay any of the cost of buying and installing the special plumbing and did not lower the rent. John can include in medical expenses the entire amount he paid.
You can include in medical expenses the cost of special hand controls and other special equipment installed in a car for the use of a person with a disability.
You can include in medical expenses fees you pay to Christian Science practitioners for medical care.
You can include in medical expenses amounts you pay for contact lenses needed for medical reasons. You can also include the cost of equipment and materials required for using contact lenses, such as saline solution and enzyme cleaner. See Eyeglasses and Eye Surgery , later.
You can include in medical expenses the amounts you pay for the prevention and alleviation of dental disease. Preventive treatment includes the services of a dental hygienist or dentist for such procedures as teeth cleaning, the application of sealants, and fluoride treatments to prevent tooth decay. Treatment to alleviate dental disease include services of a dentist for procedures such as X-rays, fillings, braces, extractions, dentures, and other dental ailments. But see Teeth Whitening under What Expenses Are Not Includible, later.
You can include in medical expenses the cost of devices used in diagnosing and treating illness and disease.
Some disabled dependent care expenses may qualify as either:
Medical expenses, or
Work-related expenses for purposes of taking a credit for dependent care. (See Publication 503, Child and Dependent Care Expenses.)
You can choose to apply them either way as long as you do not use the same expenses to claim both a credit and a medical expense deduction.
You can include in medical expenses amounts you pay for an inpatient's treatment at a therapeutic center for drug addiction. This includes meals and lodging at the center during treatment.
See Medicines , later.
You can include in medical expenses amounts you pay for eyeglasses and contact lenses needed for medical reasons. See Contact Lenses , earlier, for more information.
You can include in medical expenses the amount you pay for eye surgery to treat defective vision, such as laser eye surgery or radial keratotomy.
You can include in medical expenses the cost of the following procedures to overcome an inability to have children.
Procedures such as in vitro fertilization (including temporary storage of eggs or sperm).
Surgery, including an operation to reverse prior surgery that prevented the person operated on from having children.
See Lifetime Care—Advance Payments , later.
You can include in medical expenses the costs of buying, training, and maintaining a guide dog or other service animal to assist a visually impaired or hearing disabled person, or a person with other physical disabilities. In general, this includes any costs, such as food, grooming, and veterinary care, incurred in maintaining the health and vitality of the service animal so that it may perform its duties.
You can include in medical expenses fees you pay for treatment at a health institute only if the treatment is prescribed by a physician and the physician issues a statement that the treatment is necessary to alleviate a physical or mental defect or illness of the individual receiving the treatment.
You can include in medical expenses amounts you pay to entitle you, your spouse, or a dependent to receive medical care from an HMO. These amounts are treated as medical insurance premiums. See Insurance Premiums , later.
You can include in medical expenses the cost of a hearing aid and batteries, repairs, and maintenance needed to operate it.
See Nursing Services , later.
See Capital Expenses , earlier.
You can include in medical expenses amounts you pay for the cost of inpatient care at a hospital or similar institution if a principal reason for being there is to receive medical care. This includes amounts paid for meals and lodging. Also see Lodging , later.
You can include in medical expenses insurance premiums you pay for policies that cover medical care. Medical care policies can provide payment for treatment that includes:
Hospitalization, surgical services, X-rays,
Prescription drugs and insulin,
Replacement of lost or damaged contact lenses, and
Long-term care (subject to additional limitations). See Qualified Long-Term Care Insurance Contracts under Long-Term Care, later.
If you have a policy that provides payments for other than medical care, you can include the premiums for the medical care part of the policy if the charge for the medical part is reasonable. The cost of the medical part must be separately stated in the insurance contract or given to you in a separate statement.
Any amounts you included on Form 8885,
Any qualified health insurance premiums you paid to “U.S. Treasury–HCTC,” or
Any health coverage tax credit advance payments shown on Form 1099-H, Health Coverage Tax Credit (HCTC) Advance Payments.
Do not include in your medical and dental expenses any insurance premiums paid by an employer-sponsored health insurance plan unless the premiums are included on your Form W-2, Wage and Tax Statement. Also, do not include any other medical and dental expenses paid by the plan unless the amount paid is included on your Form W-2.
You are a federal employee participating in the premium conversion plan of the Federal Employee Health Benefits (FEHB) program. Your share of the FEHB premium is paid by making a pre-tax reduction in your salary. Because you are an employee whose insurance premiums are paid with money that is never included in your gross income, you cannot deduct the premiums paid with that money.
If you are covered under social security (or if you are a government employee who paid Medicare tax), you are enrolled in Medicare A. The payroll tax paid for Medicare A is not a medical expense.
If you are not covered under social security (or were not a government employee who paid Medicare tax), you can voluntarily enroll in Medicare A. In this situation you can include the premiums you paid for Medicare A as a medical expense.
Medicare B is a supplemental medical insurance. Premiums you pay for Medicare B are a medical expense. Check the information you received from the Social Security Administration to find out your premium.
Medicare D is a voluntary prescription drug insurance program for persons with Medicare A or B. You can include as a medical expense premiums you pay for Medicare D.
Premiums you pay before you are age 65 for insurance for medical care for yourself, your spouse, or your dependents after you reach age 65 are medical care expenses in the year paid if they are:
Payable in equal yearly installments or more often, and
Payable for at least 10 years, or until you reach age 65 (but not for less than 5 years).
You must include in gross income cash payments you receive at the time of retirement for unused sick leave. You also must include in gross income the value of unused sick leave that, at your option, your employer applies to the cost of your continuing participation in your employer's health plan after you retire. You can include this cost of continuing participation in the health plan as a medical expense.
If you participate in a health plan where your employer automatically applies the value of unused sick leave to the cost of your continuing participation in the health plan (and you do not have the option to receive cash), do not include the value of the unused sick leave in gross income. You cannot include this cost of continuing participation in that health plan as a medical expense.
You cannot include premiums you pay for:
Life insurance policies,
Policies providing payment for loss of earnings,
Policies for loss of life, limb, sight, etc.,
Policies that pay you a guaranteed amount each week for a stated number of weeks if you are hospitalized for sickness or injury,
The part of your car insurance that provides medical insurance coverage for all persons injured in or by your car because the part of the premium providing insurance for you, your spouse, and your dependents is not stated separately from the part of the premium providing insurance for medical care for others, or
Health or long-term care insurance if you elected to pay these premiums with tax-free distributions from a retirement plan made directly to the insurance provider and these distributions would otherwise have been included in income.
Taxes imposed by any governmental unit, such as Medicare taxes, are not insurance premiums.
Your child whom you do not claim as a dependent because of the rules for children of divorced or separated parents,
Any person you could have claimed as a dependent on your return except that person received $3,900 or more of gross income or filed a joint return, or
Any person you could have claimed as a dependent except that you, or your spouse if filing jointly, can be claimed as a dependent on someone else's 2013 return.
Also, if you had family coverage when you added this individual to your policy and your premiums did not increase, you can enter on Schedule A (Form 1040) the full amount of your medical and dental insurance premiums.
You can include in medical expenses the cost of keeping a person who is intellectually and developmentally disabled in a special home, not the home of a relative, on the recommendation of a psychiatrist to help the person adjust from life in a mental hospital to community living.
You can include in medical expenses the amounts you pay for laboratory fees that are part of medical care.
See Breast Pumps and Supplies , earlier.
You can include in medical expenses the cost of removing lead-based paints from surfaces in your home to prevent a child who has or had lead poisoning from eating the paint. These surfaces must be in poor repair (peeling or cracking) or within the child's reach. The cost of repainting the scraped area is not a medical expense.
If, instead of removing the paint, you cover the area with wallboard or paneling, treat these items as capital expenses. See Capital Expenses , earlier. Do not include the cost of painting the wallboard as a medical expense.
See Special Education , later.
You can include in medical expenses legal fees you paid that are necessary to authorize treatment for mental illness. However, you cannot include in medical expenses fees for the management of a guardianship estate, fees for conducting the affairs of the person being treated, or other fees that are not necessary for medical care.
You can include in medical expenses a part of a life-care fee or “founder's fee” you pay either monthly or as a lump sum under an agreement with a retirement home. The part of the payment you include is the amount properly allocable to medical care. The agreement must require that you pay a specific fee as a condition for the home's promise to provide lifetime care that includes medical care. You can use a statement from the retirement home to prove the amount properly allocable to medical care. The statement must be based either on the home's prior experience or on information from a comparable home.
You can include in medical expenses the cost of meals and lodging at a hospital or similar institution if a principal reason for being there is to receive medical care. See Nursing Home , later.
You may be able to include in medical expenses the cost of lodging not provided in a hospital or similar institution. You can include the cost of such lodging while away from home if all of the following requirements are met.
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 related to, or the equivalent of, a licensed hospital.
The lodging is not lavish or extravagant under the circumstances.
There is no significant element of personal pleasure, recreation, or vacation in the travel away from home.
The amount you include in medical expenses for lodging cannot be more than $50 for each 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 included as a medical expense for lodging. Meals are not included.
Do not include the cost of lodging while away from home for medical treatment if that treatment is not received from a doctor in a licensed hospital or in a medical care facility related to, or the equivalent of, a licensed hospital or if that lodging is not primarily for or essential to the medical care received.
You can include in medical expenses amounts paid for qualified long-term care services and premiums paid for qualified long-term care insurance contracts.
Qualified long-term care services are necessary diagnostic, preventive, therapeutic, curing, treating, mitigating, rehabilitative services, and maintenance and personal care services (defined later) that are:
Required by a chronically ill individual, and
Provided pursuant to a plan of care prescribed by a licensed health care practitioner.
He or she is unable to perform at least two activities of daily living without substantial assistance from another individual for at least 90 days, due to a loss of functional capacity. Activities of daily living are eating, toileting, transferring, bathing, dressing, and continence.
He or she requires substantial supervision to be protected from threats to health and safety due to severe cognitive impairment.
A qualified long-term care insurance contract is an insurance contract that provides only coverage of qualified long-term care services. The contract must:
Be guaranteed renewable,
Not provide for a cash surrender value or other money that can be paid, assigned, pledged, or borrowed,
Provide that refunds, other than refunds on the death of the insured or complete surrender or cancellation of the contract, and dividends under the contract must be used only to reduce future premiums or increase future benefits, and
Generally not pay or reimburse expenses incurred for services or items that would be reimbursed under Medicare, except where Medicare is a secondary payer, or the contract makes per diem or other periodic payments without regard to expenses.
The amount of qualified long-term care premiums you can include is limited. You can include the following as medical expenses on Schedule A (Form 1040).
Qualified long-term care premiums up to the following amounts.
Age 40 or under – $360.
Age 41 to 50 – $680.
Age 51 to 60 – $1,360.
Age 61 to 70 – $3,640.
Age 71 or over – $4,550.
Unreimbursed expenses for qualified long-term care services.
Note. The limit on premiums is for each person.
Also, if you are an eligible retired public safety officer, you cannot include premiums for long-term care insurance if you elected to pay these premiums with tax-free distributions from a qualified retirement plan made directly to the insurance provider and these distributions would otherwise have been included in your income.
You can include in medical expenses the cost of meals at a hospital or similar institution if a principal reason for being there is to get medical care.
You can include in medical expenses amounts paid for admission and transportation to a medical conference if the medical conference concerns the chronic illness of yourself, your spouse, or your dependent. The costs of the medical conference must be primarily for and necessary to the medical care of you, your spouse, or your dependent. The majority of the time spent at the conference must be spent attending sessions on medical information.
You can include in medical expenses amounts you pay for prescribed medicines and drugs. A prescribed drug is one that requires a prescription by a doctor for its use by an individual. You can also include amounts you pay for insulin. Except for insulin, you cannot include in medical expenses amounts you pay for a drug that is not prescribed.
You can include in medical expenses the cost of medical care in a nursing home, home for the aged, or similar institution, for yourself, your spouse, or your dependents. This includes the cost of meals and lodging in the home if a principal reason for being there is to get medical care.
Do not include the cost of meals and lodging if the reason for being in the home is personal. You can, however, include in medical expenses the part of the cost that is for medical or nursing care.
You can include in medical expenses wages and other amounts you pay for nursing services. The services need not be performed by a nurse as long as the services are of a kind generally performed by a nurse. This includes services connected with caring for the patient's condition, such as giving medication or changing dressings, as well as bathing and grooming the patient. These services can be provided in your home or another care facility.
Generally, only the amount spent for nursing services is a medical expense. If the attendant also provides personal and household services, amounts paid to the attendant must be divided between the time spent performing household and personal services and the time spent for nursing services. For example, because of your medical condition you pay a visiting nurse $300 per week for medical and household services. She spends 10% of her time doing household services such as washing dishes and laundry. You can include only $270 per week as medical expenses. The $30 (10% × $300) allocated to household services cannot be included. However, certain maintenance or personal care services provided for qualified long-term care can be included in medical expenses. See Maintenance and personal care services under Long-Term Care, earlier. Additionally, certain expenses for household services or for the care of a qualifying individual incurred to allow you to work may qualify for the child and dependent care credit. See Publication 503.
You can also include in medical expenses part of the amount you pay for that attendant's meals. Divide the food expense among the household members to find the cost of the attendant's food. Then divide that cost in the same manner as in the preceding paragraph. If you had to pay additional amounts for household upkeep because of the attendant, you can include the extra amounts with your medical expenses. This includes extra rent or utilities you pay because you moved to a larger apartment to provide space for the attendant.
You can include in medical expenses amounts you pay for legal operations that are not for unnecessary cosmetic surgery. See Cosmetic Surgery under What Expenses Are Not Includible, later.
See Eyeglasses , earlier.
See Transplants , later.
You can include in medical expenses amounts you pay for oxygen and oxygen equipment to relieve breathing problems caused by a medical condition.
You can include in medical expenses the amount you pay for an annual physical examination and diagnostic tests by a physician. You do not have to be ill at the time of the examination.
You can include in medical expenses the amount you pay to purchase a pregnancy test kit to determine if you are pregnant.
You can include in medical expenses amounts you pay for psychiatric care. This includes the cost of supporting a mentally ill dependent at a specially equipped medical center where the dependent receives medical care. See Psychoanalysis, next, and Transportation , later.
You can include in medical expenses payments for psychoanalysis. However, you cannot include payments for psychoanalysis that is part of required training to be a psychoanalyst.
You can include in medical expenses amounts you pay to a psychologist for medical care.
You can include in medical expenses fees you pay on a doctor's recommendation for a child's tutoring by a teacher who is specially trained and qualified to work with children who have learning disabilities caused by mental or physical impairments, including nervous system disorders.
You can include in medical expenses the cost (tuition, meals, and lodging) of attending a school that furnishes special education to help a child to overcome learning disabilities. A doctor must recommend that the child attend the school. Overcoming the learning disabilities must be a principal reason for attending the school, and any ordinary education received must be incidental to the special education provided. Special education includes:
Teaching Braille to a visually impaired person,
Teaching lip reading to a hearing disabled person, or
Giving remedial language training to correct a condition caused by a birth defect.
You can include in medical expenses the cost of a legal sterilization (a legally performed operation to make a person unable to have children). Also see Vasectomy , later.
You can include in medical expenses amounts you pay for a program to stop smoking. However, you cannot include in medical expenses amounts you pay for drugs that do not require a prescription, such as nicotine gum or patches, that are designed to help stop smoking.
See Operations , earlier.
You can include in medical expenses the cost of special telephone equipment that lets a person who is deaf, hard of hearing or has a speech disability communicate over a regular telephone. This includes teletypewriter (TTY) and telecommunications device for the deaf (TDD) equipment. You can also include the cost of repairing the equipment.
You can include in medical expenses the cost of equipment that displays the audio part of television programs as subtitles for persons with a hearing disability. This may be the cost of an adapter that attaches to a regular set. It also may be the part of the cost of a specially equipped television that exceeds the cost of the same model regular television set.
You can include in medical expenses amounts you pay for therapy received as medical treatment.
You can include in medical expenses amounts paid for medical care you receive because you are a donor or a possible donor of a kidney or other organ. This includes transportation.
You can include any expenses you pay for the medical care of a donor in connection with the donating of an organ. This includes transportation.
You can include in medical expenses amounts paid for transportation primarily for, and essential to, medical care.
Bus, taxi, train, or plane fares or ambulance service,
Transportation expenses of a parent who must go with a child who needs medical care,
Transportation expenses of a nurse or other person who can give injections, medications, or other treatment required by a patient who is traveling to get medical care and is unable to travel alone, and
Transportation expenses for regular visits to see a mentally ill dependent, if these visits are recommended as a part of treatment.
In 2013, Bill Jones drove 2,800 miles for medical reasons. He spent $500 for gas, $30 for oil, and $100 for tolls and parking. He wants to figure the amount he can include in medical expenses both ways to see which gives him the greater deduction.
He figures the actual expenses first. He adds the $500 for gas, the $30 for oil, and the $100 for tolls and parking for a total of $630.
He then figures the standard mileage amount. He multiplies 2,800 miles by 24 cents a mile for a total of $672. He then adds the $100 tolls and parking for a total of $772.
Bill includes the $772 of car expenses with his other medical expenses for the year because the $772 is more than the $630 he figured using actual expenses.
Going to and from work, even if your condition requires an unusual means of transportation.
Travel for purely personal reasons to another city for an operation or other medical care.
Travel that is merely for the general improvement of one's health.
The costs of operating a specially equipped car for other than medical reasons.
You can include in medical expenses amounts you pay for transportation to another city if the trip is primarily for, and essential to, receiving medical services. You may be able to include up to $50 for each 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 included as a medical expense for lodging. Meals are not included. See Lodging , earlier.
You cannot include in medical expenses a trip or vacation taken merely for a change in environment, improvement of morale, or general improvement of health, even if the trip is made on the advice of a doctor. However, see Medical Conferences , earlier.
Under special circumstances, you can include charges for tuition in medical expenses. See Special Education , earlier.
You can include charges for a health plan included in a lump-sum tuition fee if the charges are separately stated or can easily be obtained from the school.
See Eye Surgery , earlier.
You can include in medical expenses amounts you pay to lose weight if it is a treatment for a specific disease diagnosed by a physician (such as obesity, hypertension, or heart disease). This includes fees you pay for membership in a weight reduction group as well as fees for attendance at periodic meetings. You cannot include membership dues in a gym, health club, or spa as medical expenses, but you can include separate fees charged there for weight loss activities.
You cannot include the cost of diet food or beverages in medical expenses because the diet food and beverages substitute for what is normally consumed to satisfy nutritional needs. You can include the cost of special food in medical expenses only if:
The food does not satisfy normal nutritional needs,
The food alleviates or treats an illness, and
The need for the food is substantiated by a physician.
The amount you can include in medical expenses is limited to the amount by which the cost of the special food exceeds the cost of a normal diet. See also Weight-Loss Program under What Expenses Are Not Includible, later.
You can include in medical expenses amounts you pay for a wheelchair used mainly for the relief of sickness or disability, and not just to provide transportation to and from work. The cost of operating and maintaining the wheelchair is also a medical expense.
You can include in medical expenses the cost of a wig purchased upon the advice of a physician for the mental health of a patient who has lost all of his or her hair from disease.
Following is a list of some items that you cannot include in figuring your medical expense deduction. The items are listed in alphabetical order.
You cannot include in medical expenses amounts you pay for the care of children, even if the expenses enable you, your spouse, or your dependent to get medical or dental treatment. Also, any expense allowed as a childcare credit cannot be treated as an expense paid for medical care.
You cannot include in medical expenses amounts you pay for controlled substances (such as marijuana, laetrile, etc.), even if such substances are legalized by state law. Such substances are not legal under federal law and cannot be included in medical expenses.
Generally, you cannot include in medical expenses the amount you pay for unnecessary cosmetic surgery. This includes any procedure that is directed at improving the patient's appearance and does not meaningfully promote the proper function of the body or prevent or treat illness or disease. You generally cannot include in medical expenses the amount you pay for procedures such as face lifts, hair transplants, hair removal (electrolysis), and liposuction.
You can include in medical expenses the amount you pay for cosmetic surgery if it is necessary to improve a deformity arising from, or directly related to, a congenital abnormality, a personal injury resulting from an accident or trauma, or a disfiguring disease.
You cannot include in medical expenses the cost of dancing lessons, swimming lessons, etc., even if they are recommended by a doctor, if they are only for the improvement of general health.
You cannot include in medical expenses the amount you pay for diapers or diaper services, unless they are needed to relieve the effects of a particular disease.
See Cosmetic Surgery , earlier.
You cannot include in medical expenses amounts for which you are fully reimbursed by your flexible spending account if you contribute a part of your income on a pre-tax basis to pay for the qualified benefit.
Generally, you cannot include in medical expenses current payments for medical care (including medical insurance) to be provided substantially beyond the end of the year. This rule does not apply in situations where the future care is purchased in connection with obtaining lifetime care or long-term care of the type described at Lifetime Care—Advance Payments or Long-Term Care, earlier under What Medical Expenses Are Includible.
See Cosmetic Surgery , earlier.
You cannot include in medical expenses health club dues or amounts paid to improve one's general health or to relieve physical or mental discomfort not related to a particular medical condition.
You cannot include in medical expenses the cost of membership in any club organized for business, pleasure, recreation, or other social purpose.
You cannot include in medical expenses amounts you pay for health insurance that you use in figuring your health coverage tax credit. For more information, see Health Coverage Tax Credit , later.
You cannot include in medical expenses any payment or distribution for medical expenses out of a health savings account. Contributions to health savings accounts are deducted separately. See Publication 969.
You cannot include in medical expenses the cost of household help, even if such help is recommended by a doctor. This is a personal expense that is not deductible. However, you may be able to include certain expenses paid to a person providing nursing-type services. For more information, see Nursing Services , earlier under What Medical Expenses Are Includible. Also, certain maintenance or personal care services provided for qualified long-term care can be included in medical expenses. For more information, see Long-Term Care , earlier under What Medical Expenses Are Includible.
You cannot include in medical expenses amounts you pay for illegal operations, treatments, or controlled substances whether rendered or prescribed by licensed or unlicensed practitioners.
See Insurance Premiums under What Medical Expenses Are Includible, earlier.
You cannot include in medical expenses amounts you contribute to an Archer MSA. You cannot include expenses you pay for with a tax-free distribution from your Archer MSA. You also cannot use other funds equal to the amount of the distribution and include the expenses. For more information on Archer MSAs, see Publication 969.
In general, you cannot include in your medical expenses the cost of a prescribed drug brought in (or ordered shipped) from another country. You can only include the cost of a drug that was imported legally. For example, you can include the cost of a prescribed drug the Food and Drug Administration announces can be legally imported by individuals.
You can include the cost of a prescribed drug you purchase and consume in another country if the drug is legal in both the other country and the United States.
You cannot include in medical expenses the cost of nutritional supplements, vitamins, herbal supplements, “natural medicines,” etc. unless they are recommended by a medical practitioner as treatment for a specific medical condition diagnosed by a physician. Otherwise, these items are taken to maintain your ordinary good health, and are not for medical care.
You cannot include in medical expenses the cost of an item ordinarily used for personal, living, or family purposes unless it is used primarily to prevent or alleviate a physical or mental defect or illness. For example, the cost of a toothbrush and toothpaste is a nondeductible personal expense.
In order to accommodate an individual with a physical defect, you may have to purchase an item ordinarily used as a personal, living, or family item in a special form. You can include the excess of the cost of the item in a special form over the cost of the item in normal form as a medical expense. (See Braille Books and Magazines under What Medical Expenses Are Includible, earlier.)
See Dancing Lessons , earlier.
You cannot include in medical expenses amounts paid to whiten teeth. See Cosmetic Surgery , earlier.
You generally cannot include veterinary fees in your medical expenses, but see Guide Dog or Other Service Animal under What Medical Expenses Are Includible, earlier.
You cannot include in medical expenses the cost of a weight-loss program if the purpose of the weight loss is the improvement of appearance, general health, or sense of well-being. You cannot include amounts you pay to lose weight unless the weight loss is a treatment for a specific disease diagnosed by a physician (such as obesity, hypertension, or heart disease). If the weight-loss treatment is not for a specific disease diagnosed by a physician, you cannot include either the fees you pay for membership in a weight reduction group or fees for attendance at periodic meetings. Also, you cannot include membership dues in a gym, health club, or spa.
You cannot include the cost of diet food or beverages in medical expenses because the diet food and beverages substitute for what is normally consumed to satisfy nutritional needs.
See Weight-Loss Program under What Medical Expenses Are Includible, earlier.
You can include in medical expenses only those amounts paid during the tax year for which you received no insurance or other reimbursement.
You must reduce your total medical expenses for the year by all reimbursements for medical expenses that you receive from insurance or other sources during the year. This includes payments from Medicare.
Even if a policy provides reimbursement only for certain specific medical expenses, you must use amounts you receive from that policy to reduce your total medical expenses, including those it does not reimburse.
You have insurance policies that cover your hospital and doctors' bills but not your nursing bills. The insurance you receive for the hospital and doctors' bills is more than their charges. In figuring your medical deduction, you must reduce the total amount you spent for medical care by the total amount of insurance you received, even if the policies do not cover some of your medical expenses.
Permanent loss or loss of use of a member or function of the body (loss of limb, sight, hearing, etc.) or disfigurement to the extent the payment is based on the nature of the injury without regard to the amount of time lost from work, or
Loss of earnings.
If you are reimbursed more than your medical expenses, you may have to include the excess in income. You may want to use Figure 1 to help you decide if any of your reimbursement is taxable.
|Instructions: Use this worksheet to figure the amount of excess reimbursement you must include in income when both you and your employer contributed to your medical insurance and your employer's contributions are not included in your gross income.|
|1.||Enter the amount contributed to your medical insurance for the year by your employer||1.|
|2.||Enter the total annual cost of the policy||2.|
|3.||Divide line 1 by line 2||3.|
|4.||Enter the amount of excess reimbursement||4.|
|5.||Multiply line 3 by line 4. This is the amount of the excess reimburse-
ment you must include as other income on Form 1040
|Instructions: Use this worksheet to figure the amount of excess reimbursement you must include as income on your tax return when (a) you are reimbursed under two or more health insurance policies, (b) at least one of which is paid for by both you and your employer, and (c) your employer's contributions are not included in your gross income. If you and your employer did not share in the cost of at least one policy, do not use this worksheet.|
|1.||Enter the reimbursement from your employer's policy||1.|
|2.||Enter the reimbursement from your own policy||2.|
|3.||Add lines 1 and 2||3.|
|4.||Divide line 1 by line 3||4.|
|5.||Enter the total medical expenses you paid during the year. If this amount is at least as much as the amount on line 3, stop here because there is no excess reimbursement||5.|
|6.||Multiply line 4 by line 5||6.|
|7.||Subtract line 6 from line 1||7.|
|8.||Enter employer's contribution to the annual cost of the employer's policy||8.|
|9.||Enter total annual cost of the employer's policy||9.|
|10.||Divide line 8 by line 9. This is the percentage of your total excess reimbursement you must report as other income||10.|
|11.||Multiply line 7 by line 10. This is the amount of your total excess
reimbursement you must report as other income on Form 1040
If you are reimbursed in a later year for medical expenses you deducted in an earlier year, you generally must report the reimbursement as income up to the amount you previously deducted as medical expenses.
However, do not report as income the amount of reimbursement you received up to the amount of your medical deductions that did not reduce your tax for the earlier year.
For more information about the recovery of an amount that you claimed as an itemized deduction in an earlier year, see Recoveries in Publication 525, Taxable and Nontaxable Income.
If you did not deduct a medical expense in the year you paid it because your medical expenses were not more than 10% of your AGI (7.5% of your AGI if either you or your spouse was born before January 2, 1949), or because you did not itemize deductions, do not include the reimbursement, up to the amount of the expense, in income. However, if the reimbursement is more than the expense, see What If Your Insurance Reimbursement Is More Than Your Medical Expenses , earlier.
Last year, you were unmarried, you were born after January 2, 1949, and you had $500 of medical expenses. You cannot deduct the $500 because it is less than 10% of your AGI. If, in a later year, you are reimbursed for any of the $500 of medical expenses, you do not include that amount in your gross income.
Once you have determined which medical expenses you can include, figure and report the deduction on your tax return.
You report your medical expense deduction on Schedule A, Form 1040. You cannot claim medical expenses on Form 1040A, U.S. Individual Income Tax Return, or Form 1040EZ, Income Tax Return for Single and Joint Filers With No Dependents. See the instructions for Schedule A (Form 1040) for more detailed information on figuring your medical and dental expense deduction.
If you deduct the cost of medical equipment or property in one year and sell it in a later year, you may have a taxable gain. The taxable gain is the amount of the selling price that is more than the adjusted basis of the equipment or property.
The adjusted basis is the portion of the cost of the equipment or property that you could not deduct because of the 10% limit (or 7.5% if either you or your spouse was born before January 2, 1949), used to compute the medical deduction. Use Worksheet D, later, to figure the adjusted basis of the equipment or property.
|Instructions: Use this worksheet if you deducted the cost of medical equipment or property in one year and sold the equipment or property in a later year. This worksheet will give you the adjusted basis of the equipment or property you sold.|
|1.||Enter the cost of the equipment or property||1.|
|2.||Enter your total includible medical expenses for the year you included the cost in your medical expenses||2.|
|3.||Divide line 1 by line 2||3.|
|4.||Enter 10% (or 7.5% if either you or your spouse was born before January 2, 1949), of your AGI for the year the cost was included in your medical expenses||4.|
|5.||Multiply line 3 by line 4. If your allowable itemized deductions for the year you purchased the equipment or property were not more than your AGI for that year, stop here. This is the adjusted basis of the equipment or property. If your allowable itemized deductions for the year you purchased the equipment or property were more than your AGI for that year, complete lines 6 through 11||5.|
|6.||Subtract line 5 from line 1||6.|
|7.||Enter your total allowable itemized deductions for the year the cost was included in your medical expenses||7.|
|8.||Divide line 6 by line 7||8.|
|9.||Enter your AGI for the year the cost was included in your medical expenses.||9.|
|10.||Subtract line 9 from line 7||10.|
|11.||Multiply line 8 by line 10||11.|
|12.||Add line 5 to line 11. If your allowable itemized deductions for the year you purchased the equipment or property were more than your AGI for that year, this is the adjusted basis of the equipment or property||12.|
Next, use Worksheet E to figure the total gain or loss on the sale of the medical equipment or property.
|Instructions: Use the following worksheet to figure total gain or loss on the sale of medical equipment or property that you deducted in an earlier year.|
|1.||Enter the amount that the medical equipment or property sold for||1.|
|2.||Enter your selling expenses||2.|
|3.||Subtract line 2 from line 1||3.|
|4.||Enter the adjusted basis of the equipment or property from Worksheet D, line 5, or line 12, if applicable||4.|
|5.||Subtract line 4 from line 3. This is the total gain or loss from the sale of the medical equipment or property||5.|
If you have a loss, it is not deductible. If you have a gain, it is includible in your income. The part of the gain that is a recovery of an amount you previously deducted is taxable as ordinary income. Enter it on Form 1040. Any part of the gain that is more than the recovery of an amount you previously deducted is taxable as a capital gain. Enter it on Form 8949, Sales and Other Dispositions of Capital Assets, and Schedule D (Form 1040), Capital Gains and Losses.
For more information about the recovery of an amount that you claimed as an itemized deduction in an earlier year, see Recoveries in Publication 525.
If you receive an amount in settlement of a personal injury suit, part of that award may be for medical expenses that you deducted in an earlier year. If it is, you must include that part in your income in the year you receive it to the extent it reduced your taxable income in the earlier year. See What If You Receive Insurance Reimbursement in a Later Year , discussed earlier under How Do You Treat Reimbursements.
You sued this year for injuries you suffered in an accident last year. You sought $10,000 for your injuries and did not itemize your damages. Last year, you paid $500 for medical expenses for your injuries. You deducted those expenses on last year's tax return. This year you settled your lawsuit for $2,000. Your settlement did not itemize or allocate the damages. The $2,000 is first presumed to be for the medical expenses that you deducted. The $500 is includible in your income this year because you deducted the entire $500 as a medical expense deduction last year.
You were injured in an accident. You sued and sought a judgment of $50,000 for your injuries. You settled the suit for $45,000. The settlement provided that $10,000 of the $45,000 was for future medical expenses for your injuries. You cannot include the first $10,000 that you pay for medical expenses for those injuries.
If you are a person with disabilities, you can take a business deduction for expenses that are necessary for you to be able to work. If you take a business deduction for these impairment-related work expenses, they are not subject to the 10% limit (or 7.5% if either you or your spouse was born before January 2, 1949), that applies to medical expenses.
You have a disability if you have:
A physical or mental disability (for example, blindness or deafness) that functionally limits your being employed, or
A physical or mental impairment (for example, a sight or hearing impairment) that substantially limits one or more of your major life activities, such as performing manual tasks, walking, speaking, breathing, learning, or working.
Necessary for you to do your work satisfactorily,
For goods and services not required or used, other than incidentally, in your personal activities, and
Not specifically covered under other income tax laws.
You are blind. You must use a reader to do your work. You use the reader both during your regular working hours at your place of work and outside your regular working hours away from your place of work. The reader's services are only for your work. You can deduct your expenses for the reader as business expenses.
If you were self-employed and had a net profit for the year, you may be able to deduct, as an adjustment to income, amounts paid for medical and qualified long-term care insurance on behalf of yourself, your spouse, your dependents, and your children who were under age 27 at the end of 2013. For this purpose, you were self-employed if you were a general partner (or a limited partner receiving guaranteed payments) or you received wages from an S corporation in which you were more than a 2% shareholder. The insurance plan must be established under your trade or business and the deduction cannot be more than your earned income from that trade or business.
You cannot deduct payments for medical insurance for any month in which you were eligible to participate in a health plan subsidized by your employer, your spouse's employer or an employer of your dependent or your child under age 27 at the end of 2013. You cannot deduct payments for a qualified long-term care insurance contract for any month in which you were eligible to participate in a long-term care insurance plan subsidized by your employer or your spouse's employer.
If you qualify to take the deduction, use the Self-Employed Health Insurance Deduction Worksheet in the Form 1040 instructions to figure the amount you can deduct. But if any of the following applies, do not use that worksheet.
You had more than one source of income subject to self-employment tax.
You file Form 2555, Foreign Earned Income, or Form 2555-EZ, Foreign Earned Income Exclusion.
You are using amounts paid for qualified long-term care insurance to figure the deduction.
If you cannot use the worksheet in the Form 1040 instructions, use the worksheet in Publication 535, Business Expenses, to figure your deduction.
If, during 2013, you were an eligible trade adjustment assistance (TAA) recipient, alternative TAA (ATAA) recipient, reemployment TAA (RTAA) recipient, or Pension Benefit Guaranty Corporation pension recipient, see the instructions for Form 8885 to figure the amount to enter on the worksheet.
When figuring the amount you can deduct for insurance premiums, do not include amounts paid for health insurance coverage with retirement plan distributions that were tax-free because you are a retired public safety officer.
Kate is self-employed in 2013 and has self-only coverage for health insurance. Her premium for that coverage was $5,000 for the year. She changes to family coverage only to add her 26-year-old nondependent child to the plan. Her health insurance premium increases to $10,000 for the year. After completing the Self-Employed Health Insurance Deduction Worksheet in the instructions for Form 1040, she can only deduct $4,000 on Form 1040. The $4,000 is allocable to the nondependent child. On Schedule A, she can only claim the $5,000 allocable to her coverage. She cannot claim the $1,000 excess premiums allocable to the nondependent child.
The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) provides that if you were covered under a group health plan and you would lose coverage because of a qualifying event, you should be allowed an opportunity to elect COBRA continuation health coverage under the plan. If there was no available election, your employer or the plan was subject to an excise tax. You can be required to pay the full premium for the COBRA continuation coverage.
If you are an assistance eligible individual, you pay 35% of the premium otherwise payable for this coverage and are treated as having paid the full premium. You are an assistance eligible individual if:
You are a qualified beneficiary as a result of an involuntary termination that occurred during the period beginning on September 1, 2008, and ending on May 31, 2010, or had a reduction of hours during that period, which was followed by a termination of your employment that occurred after March 1, 2010, and before June 1, 2010,
You are eligible for COBRA continuation coverage related to the qualifying event occurring during the period beginning on September 1, 2008, and
You elect the coverage.
A qualified beneficiary is generally any individual who is covered under a group health plan on the day before the involuntary termination. This includes the covered employee, the employee’s spouse, and the employee’s dependent.
The premium assistance (the 65% reduction of the premium) applies to the first period of coverage beginning after February 16, 2009. The reduction applies until the earliest of:
The first date the assistance eligible individual becomes eligible for other group health plan coverage or Medicare coverage,
The date that is 15 months after the first day of the first month for which the reduced premium applies to the individual, or
The date the individual ceases to be eligible for COBRA continuation coverage.
The premium assistance is not included in your gross income. However, if your modified adjusted gross income (AGI) is more than $125,000 ($250,000 if married filing jointly) but not more than $145,000 ($290,000 if married filing jointly), your income tax for the year is increased by a percentage of the premium assistance. Use Worksheet F to figure the amount you must include as tax on your return. If your modified AGI is more than $145,000 ($290,000 if married filing jointly), your income tax for the tax year is increased by the total premium assistance. See the instructions for Form 1040 or Form 104NR for how to report this amount.
|Instructions: Use the following worksheet to figure the taxable portion of your COBRA premium if your modified AGI (line 3) is more than $125,000 ($250,000 if married filing jointly) but less than $145,000 ($290,000 if married filing jointly).|
|1.||Enter your AGI (from Form 1040 or Form 1040NR)||1.|
|2.||Enter the total of any amounts from Form 2555, lines 45 and 50; Form 2555-EZ, line 18; and Form 4563, line 15, and any exclusion of income from American Samoa and Puerto Rico||2.|
|3.||Modified AGI. Add lines 1 and 2||3.|
|4.||Enter $125,000 ($250,000 if married filing jointly)||4.|
|5.||Subtract line 4 from line 3||5.|
|6.||Enter $20,000 ($40,000 if married filing jointly)||6.|
|7.||Divide line 5 by line 6. Enter the result as a decimal (rounded to at least 3 places)||7.||.|
|8.||Enter the amount of the COBRA premium assistance* you received in 2013||8.|
|9.||Multiply line 8 by line 7. Enter the result here and include it on Form 1040 or Form 1040NR. See the instructions for Form 1040 or Form 1040NR for how to report this amount||9.|
|*Contact your former employer or health insurance plan to obtain the total premium assistance, if unknown.|
You may elect to permanently waive the right to the premium assistance. You will not receive the premium assistance and you will not have to include the assistance in your income tax if your modified AGI is more than $125,000 ($250,000 if married filing jointly). To make this election, give a signed and dated notification (include a reference to “permanent waiver”) to the person to whom premiums are payable.
You will not qualify for the health coverage tax credit (discussed next) for any month for which you receive premium assistance.
For more information, see Notice 2009-27, available at www.irs.gov/irb/2009-16_irb/ar09.
If you paid the premiums for qualified health insurance coverage, you may be able to claim the health coverage tax credit (HCTC). If you are eligible, you can get monthly HCTC (advance payments), a yearly HCTC, or a combination of these methods (see How To Take the Credit , later). The HCTC is 72.5% of the payments made in 2013.
You can take this credit for any month in which all of the following were true on the first day of the month.
You were an eligible:
Trade adjustment assistance (TAA) recipient,
Alternative TAA recipient,
Reemployment TAA recipient,
Pension Benefit Guaranty Corporation (PBGC) pension payee, or
You were a qualifying family member of an individual described in a, b, c, or d when he or she enrolled in Medicare, died, or got divorced. See Family members in certain life events (enrollment in Medicare, death, or divorce) , later.
You paid the premium for qualified health insurance coverage for yourself or a qualifying family member. See Qualified Health Insurance , later.
You were not imprisoned under federal, state, or local authority.
You did not have other specified coverage. See Other Specified Coverage , later.
If you were an eligible individual described in 1a, 1b, 1c, or 1d, your state’s workforce agency (unemployment office) or the PBGC will notify the HCTC Program that you may be eligible for the credit. When notified, the HCTC Program will mail you an HCTC Eligibility Kit. If you have not received the Eligibility Kit, you may not be an eligible individual and not qualify for the credit. If you believe you are eligible for the HCTC and have not received an Eligibility Kit, go to IRS.gov and enter “HCTC” in the search box for information on how to contact the HCTC Program.
You can include the premiums you pay for qualified health insurance for qualifying family members in figuring your credit. A qualifying family member is:
Your spouse (but see Both spouses eligible, later), or
Anyone whom you can claim as a dependent on your tax return. (For children whose parents are divorced, see Children of divorced or separated parents , later.)
However, anyone who has other specified coverage (defined later) is not a qualifying family member.
You are married at the end of the year.
You and your spouse are both eligible recipients during the year.
You file separate tax returns.
You file a separate return.
Your home is the home for more than half the year of a dependent under age 13 or a dependent who is physically or mentally not able to care for himself or herself.
You pay more than half the cost of keeping up your home for the year.
Your spouse does not live in your home for the last 6 months of the year.
The following health insurance qualifies for the credit.
COBRA continuation coverage. (This is coverage that employers with 20 or more employees must offer to employees or former employees and their beneficiaries who have lost coverage because of certain events.) See the caution later.
Coverage under a group health plan that is available through the employment of your spouse. (But see Other Specified Coverage , later.)
Coverage under a non-group (individual) health insurance plan, if the first day of your coverage started at least 30 days before you left your job that qualified you for TAA, ATAA, RTAA, or PBGC benefits, or the date of Medicare enrollment, death of or divorce from the original TAA recipient or PBGC payee that provided you with extended eligibility as a qualified family member. Individual health insurance does not include any insurance connected with a group health plan of federal or state based health insurance coverage.
Visit IRS.gov, and type “HCTC” in the search box, and then, click on HCTC: List of State-Qualified Health Plans, or
Call the HCTC Customer Contact Center by February 28, 2014, toll-free at 1-866-628-HCTC (4282). For those who are deaf, hard of hearing, or have a speech disability, call 1-866-626-4282 (TTY/TDD). The Customer Contact Center is open Monday to Friday from 8:00 am through 5:00 pm Central time. Please be advised that the HCTC expires January 1, 2014, and the tax credit will no longer be available. After February 28, 2014, please visit www.irs.gov/hctc for updated information about the HCTC.
The following health insurance does not qualify for the credit.
Medicare supplemental (Medigap) insurance, Tricare supplemental insurance, or similar supplemental insurance to an employer-sponsored group health plan.
Any insurance if substantially all of the coverage is:
Coverage for on-site medical clinics,
Hospital indemnity or other fixed indemnity insurance,
Accident or disability income insurance (or a combination of the two),
A supplement to liability insurance,
Workers' compensation or similar insurance,
Automobile medical payment insurance,
Limited scope dental or vision benefits,
Benefits for long-term care, nursing home care, home health care, community-based care (or any combination), or
Coverage for only a specified disease or illness.
Coverage under a flexible spending or similar arrangement.
The charge for insurance for yourself and qualifying family members is either separately stated in the contract or furnished to you by the insurance company in a separate statement.
The amount you paid for insurance for yourself and qualifying family members is not more than the charge that is stated in the contract or furnished by the insurance company.
The amount stated in the contract or furnished by the insurance company is not unreasonably large in relation to the total charges under the contract.
Eligibility for the credit is determined on a monthly basis. An eligible coverage month is any month in which, as of the first day of the month, you:
If you file a joint return, only one spouse has to satisfy the requirements.
Even if you or your qualifying family member are otherwise eligible, you or your qualifying family member are not eligible for the credit for a month if, as of the first day of the month, you or your qualifying family member have other specified coverage. Other specified coverage is coverage under the following.
Any insurance which constitutes medical care (unless substantially all of that insurance is for benefits listed earlier under (1) or (2) under Nonqualified Health Insurance ) if at least 50% of the cost of the coverage is paid by an employer (or former employer) of you or your spouse.
Any of the following government health programs:
Medicare Part A, B, or C,
Medicaid, or the Children's Health Insurance Program (CHIP),
The Federal Employees Health Benefit Program (FEHBP), or
Tricare, the medical and dental care program for members and certain former members of the uniformed services and their dependents.
If you claim this credit, you cannot take the same expenses that you use to figure your HCTC into account in determining your:
You cannot use payments you made with funds from the following accounts to figure the credit:
Health Savings Accounts (HSAs), or
Archer Medical Savings Accounts (MSAs).
The HCTC is 72.5% for payments made in 2013. To claim the yearly HCTC, complete Form 8885, and attach it to your Form 1040, Form 1040NR, U.S. Nonresident Alien Income Tax Return; Form 1040-SS, U.S. Self-Employment Tax Return; or Form 1040-PR, Planilla para la Declaración de la Contribución Federal sobre el Trabajo por Cuenta Propia. You cannot claim the credit on Form 1040A, Form 1040EZ, or Form 1040NR-EZ, U.S. Income Tax Return for Certain Nonresident Aliens With No Dependents.
You may claim the yearly HCTC if you were an eligible recipient and:
Did not receive monthly HCTC (advanced payments), or
Received advanced payments and also made eligible payments directly to your health plan.
Qualify for the credit, and
File a tax return, even if you:
Do not owe any tax,
Did not earn enough money to file a return, or
Did not have income taxes withheld from your pay.
Under monthly HCTC (advance payments), you only pay part of the premium for health insurance and the HCTC Program pays the rest of the premium. The part paid by the HCTC Program is your monthly HCTC.
You pay your part of the premium to the HCTC Program. The program adds the advance payment and pays the total premium to your health plan.
If you want to receive the monthly HCTC, you must fill out the registration form and send it and any supporting documents to the HCTC Program. Once you are enrolled in the HCTC Program, you will receive a monthly invoice stating the amount you must pay to the program and the due date.
If you receive a monthly HCTC, you will get Form 1099-H. The form shows you the total of your advance payments and for which months payments were made (including months for which reimbursement credits were paid to you). You cannot claim the yearly HCTC for any month for which you received a monthly HCTC.
Whether it's help with a tax issue, preparing your tax return or a need for a free publication or form, get the help you need the way you want it: online, use a smart phone, call or walk in to an IRS office or volunteer site near you.
Download the free IRS2Go app from the iTunes app store or from Google Play. Use it to check your refund status, order transcripts of your tax returns or tax account, watch the IRS YouTube channel, get IRS news as soon as it's released to the public, subscribe to filing season updates or daily tax tips, and follow the IRS Twitter news feed, @IRSnews, to get the latest federal tax news, including information about tax law changes and important IRS programs.
Check the status of your 2013 refund with the Where's My Refund? application on IRS.gov or download the IRS2Go app and select the Refund Status option. The IRS issues more than 9 out of 10 refunds in less than 21 days. Using these applications, you can start checking on the status of your return within 24 hours after we receive your e-filed return or 4 weeks after you mail a paper return. You will also be given a personalized refund date as soon as the IRS processes your tax return and approves your refund. The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day.
Use the Interactive Tax Assistant (ITA) to research your tax questions. No need to wait on the phone or stand in line. The ITA is available 24 hours a day, 7 days a week, and provides you with a variety of tax information related to general filing topics, deductions, credits, and income. When you reach the response screen, you can print the entire interview and the final response for your records. New subject areas are added on a regular basis.
Answers not provided through ITA may be found in Tax Trails, one of the Tax Topics on IRS.gov which contain general individual and business tax information or by searching the IRS Tax Map, which includes an international subject index. You can use the IRS Tax Map, to search publications and instructions by topic or keyword. The IRS Tax Map integrates forms and publications into one research tool and provides single-point access to tax law information by subject. When the user searches the IRS Tax Map, they will be provided with links to related content in existing IRS publications, forms and instructions, questions and answers, and Tax Topics.
Coming this filing season, you can immediately view and print for free all 5 types of individual federal tax transcripts (tax returns, tax account, record of account, wage and income statement, and certification of non-filing) using Get Transcript. You can also ask the IRS to mail a return or an account transcript to you. Only the mail option is available by choosing the Tax Records option on the IRS2Go app by selecting Mail Transcript on IRS.gov or by calling 1-800-908-9946. Tax return and tax account transcripts are generally available for the current year and the past three years.
Determine if you are eligible for the EITC and estimate the amount of the credit with the Earned Income Tax Credit (EITC) Assistant.
Visit Understanding Your IRS Notice or Letter to get answers to questions about a notice or letter you received from the IRS.
If you received the First Time Homebuyer Credit, you can use the First Time Homebuyer Credit Account Look-up tool for information on your repayments and account balance.
Check the status of your amended return using Where's My Amended Return? Go to IRS.gov and enter Where's My Amended Return? in the search box. You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. It can take up to 3 weeks from the date you mailed it to show up in our system.
Make a payment using one of several safe and convenient electronic payment options available on IRS.gov. Select the Payment tab on the front page of IRS.gov for more information.
Determine if you are eligible and apply for an online payment agreement, if you owe more tax than you can pay today.
Figure your income tax withholding with the IRS Withholding Calculator on IRS.gov. Use it if you've had too much or too little withheld, your personal situation has changed, you're starting a new job or you just want to see if you're having the right amount withheld.
Determine if you might be subject to the Alternative Minimum Tax by using the Alternative Minimum Tax Assistant on IRS.gov.
Request an Electronic Filing PIN by going to IRS.gov and entering Electronic Filing PIN in the search box.
Download forms, instructions and publications, including accessible versions for people with disabilities.
Locate the nearest Taxpayer Assistance Center (TAC) using the Office Locator tool on IRS.gov, or choose the Contact Us option on the IRS2Go app and search Local Offices. An employee can answer questions about your tax account or help you set up a payment plan. Before you visit, check the Office Locator on IRS.gov, or Local Offices under Contact Us on IRS2Go to confirm the address, phone number, days and hours of operation, and the services provided. If you have a special need, such as a disability, you can request an appointment. Call the local number listed in the Office Locator, or look in the phone book under United States Government, Internal Revenue Service.
Apply for an Employer Identification Number (EIN). Go to IRS.gov and enter Apply for an EIN in the search box.
Read the Internal Revenue Code, regulations, or other official guidance.
Read Internal Revenue Bulletins.
Sign up to receive local and national tax news and more by email. Just click on “subscriptions” above the search box on IRS.gov and choose from a variety of options.
Call to locate the nearest volunteer help site, 1-800-906-9887 or you can use the VITA Locator Tool on IRS.gov, or download the IRS2Go app. Low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers can get free help with their tax return from the nationwide Volunteer Income Tax Assistance (VITA) program. The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. Most VITA and TCE sites offer free electronic filing. Some VITA and TCE sites provide IRS-certified volunteers who can help prepare your tax return. Through the TCE program, AARP offers the Tax-Aide counseling program; call 1-888-227-7669 to find the nearest Tax-Aide location.
Call the automated Where's My Refund? information hotline to check the status of your 2013 refund 24 hours a day, 7 days a week at 1-800-829-1954. If you e-file, you can start checking on the status of your return within 24 hours after the IRS receives your tax return or 4 weeks after you've mailed a paper return. The IRS issues more than 9 out of 10 refunds in less than 21 days. Where's My Refund? will give you a personalized refund date as soon as the IRS processes your tax return and approves your refund. Before you call this automated hotline, have your 2013 tax return handy so you can enter your social security number, your filing status, and the exact whole dollar amount of your refund. The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. Note, the above information is for our automated hotline. Our live phone and walk-in assistors can research the status of your refund only if it's been 21 days or more since you filed electronically or more than 6 weeks since you mailed your paper return.
Call the Amended Return Hotline, 1-866-464-2050, to check the status of your amended return. You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. It can take up to 3 weeks from the date you mailed it to show up in our system.
Call 1-800-TAX-FORM (1-800-829-3676) to order current-year forms, instructions, publications, and prior-year forms and instructions (limited to 5 years). You should receive your order within 10 business days.
Call TeleTax, 1-800-829-4477, to listen to pre-recorded messages covering general and business tax information. If, between January and April 15, you still have questions about the Form 1040, 1040A, or 1040EZ (like filing requirements, dependents, credits, Schedule D, pensions and IRAs or self-employment taxes), call 1-800-829-1040.
Call using TTY/TDD equipment, 1-800-829-4059 to ask tax questions or order forms and publications. The TTY/TDD telephone number is for people who are deaf, hard of hearing, or have a speech disability. These individuals can also contact the IRS through relay services such as the Federal Relay Service.
Products. You can walk in to some post offices, libraries, and IRS offices to pick up certain forms, instructions, and publications. Some IRS offices, libraries, and city and county government offices have a collection of products available to photocopy from reproducible proofs.
Services. You can walk in to your local TAC for face-to-face tax help. An employee can answer questions about your tax account or help you set up a payment plan. Before visiting, use the Office Locator tool on IRS.gov, or choose the Contact Us option on the IRS2Go app and search Local Offices for days and hours of operation, and services provided.
Internal Revenue Service
1201 N. Mitsubishi Motorway
Bloomington, IL 61705-6613
The Taxpayer Advocate Service Is Here to Help You. The Taxpayer Advocate Service (TAS) is your voice at the IRS. Our job is to ensure that every taxpayer is treated fairly and that you know and understand your rights.
What can TAS do for you? We can offer you free help with IRS problems that you can't resolve on your own. We know this process can be confusing, but the worst thing you can do is nothing at all! TAS can help if you can't resolve your tax problem and:
Your problem is causing financial difficulties for you, your family, or your business.
You face (or your business is facing) an immediate threat of adverse action.
You've tried repeatedly to contact the IRS but no one has responded, or the IRS hasn't responded by the date promised.
If you qualify for our help, you'll be assigned to one advocate who'll be with you at every turn and will do everything possible to resolve your problem. Here's why we can help:
TAS is an independent organization within the IRS.
Our advocates know how to work with the IRS.
Our services are free and tailored to meet your needs.
We have offices in every state, the District of Columbia, and Puerto Rico.
How can you reach us? If you think TAS can help you, call your local advocate, whose number is in your local directory and at Taxpayer Advocate, or call us toll-free at 1-877-777-4778.
How else does TAS help taxpayers?
TAS also works to resolve large-scale, systemic problems that affect many taxpayers. If you know of one of these broad issues, please report it to us through our Systemic Advocacy Management System.
Low Income Taxpayer Clinics (LITCs) serve individuals whose income is below a certain level and need to resolve tax problems such as audits, appeals and tax collection disputes. Some clinics can provide information about taxpayer rights and responsibilities in different languages for individuals who speak English as a second language. Visit Taxpayer Advocate or see IRS Publication 4134, Low Income Taxpayer Clinic List.
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