Overlooked Tax Deductions for Seniors

Medical bills add up as we get older. Especially if you have a serious medical condition, you may quickly find yourself overwhelmed by expenses. An alarming $280,000 is the average cost for medical care for seniors. And if you are paying out of pocket for long term care, you can expect to add in an additional $4,000 to $7,000 per month. But on the bright side, nearly 9 million Americans currently claim tax deductions to help them lower their tax liability on medical care.

This article from Tax Act describes in detail the deductions for what the IRS calls “qualified medical expenses”. What qualifies as a medical expense for tax deductions? There are many rules and regulations. However, there are qualified medical expenses that can be commonly overlooked tax deductions for seniors. These can include all prescriptions from a doctor. The costs of things like aquatic therapy and medical home modifications can qualify as well as wigs for hair loss. Consult your Certified Public Accountant (CPA) for more information.

In order to deduct medical expenses, you must keep extremely good records of all expenses. Even those you think could possibly be a qualified medical expense should be recorded. Something like an accordion folder to keep track of receipts is helpful or software like Quicken or QuickBooks. Always keep your records for a minimum of three years. If your tax return is audited, you will need proof of your medical costs. If this all sounds overwhelming and confusing, consider asking your pharmacy and credit card company for statements at the end of the year. While it may not include everything, it may remind you of  things that were overlooked.

Sadly, the cost of medical care in the United States continues to increase. Additionally, as you age you typically require more care, leading to even higher costs. It may feel impossible to cover the rising costs of care for you or your elderly loved one. Becoming informed about tax deductions for medical expenses is important to reduce the financial strain on you and your family.