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Tax Season Giving You Migraines? Deduct It!

It’s tax season- yippee! Break out the calculators, the W-2’s, 1099’s and whatever other ridiculous forms you get mailed to remind you that you don’t make as much money as if you didn’t have Chronic Migraines…or episodic Migraines either! Both can have a huge impact on your earning potential and quickly deplete your pocket book as you spend money trying to find a new treatment to make your life more bearable. However, at tax time you can take advantage of all the money you’ve invested in your health in the past year and possibly get a deduction for your medical expenses.

Let me be very clear. I am NOT an accountant. But as many of us have above average health care costs, it’s important to be aware of the potential deductions you can take. As of 2013, if your medical costs are more than 10% of your Adjusted Gross Income (AGI) you can deduct them. So if you made $40,000 last year and your medical bills totaled $4,001, you can claim a deduction.  And a deduction means more money in your pocket or less money that you will have to pay the government, depending on your situation.

You will need to itemize these deductions, meaning you’ll need to have very complete and accurate details of the expenses that you list. How much did you pay for prescriptions? Hospitals stays? Copays? Travel expense for doctor visits? If you use Turbo Tax, it walks you through every related question very easily, but you need to have the raw data. Keep receipts and invoices showing name of provider, date of service and cost. While you do not need to send the proof in with your completed taxes, it is a good practice to have it in case you get audited.

The IRS website has more detail on how to handle itemized medical deductions found here: http://www.irs.gov/Individuals/2013-Changes-to-Itemized-Deduction-for-Medical-Expenses

Here are a few key things to know:

  • These must be unreimbursed expenses. Anything paid for using a Health or Flex Savings account is not eligible due because those are pre-tax funds.
  • These rules apply to persons under 65. Anyone over 65 can deduct medical expenses of 7.5% of their AGI through 2016.
  • Common items that can be deducted are: acupuncture, expenses to modify your home to accommodate a handicap, copays for doctor visits, chiropractor, dental work, legal fees related to medical care, lodging and travel, medical conferences, medicines, physical therapy, psychologist, psychiatrist. See a full list here: http://www.irs.gov/pub/irs-pdf/p502.pdf

I personally just finished up my taxes and itemized my medical expenses for the year. It was sobering. After a few hours of adding up receipts and categorizing them, I spent a whooping $10,270 last year on medical expenses. That includes prescriptions, massage therapy, doctor co-pays, insurance premiums, a hospital stay and travel expenses. I expect to be in the same range next year. Needless to say, on Long Term Disability benefits I don’t make $100,000 a year, so I was able to take a deduction for my medical expenses.

Besides being able to deduct the expenses on my taxes, I was able to gain some other knowledge from these figures:

  • $10,270 annually is an average of $850 a month. That could be a lot of shoes. I rarely go out-of-network (which is expensive) to keep costs down, but I do have the Cadillac of insurance plans to cover everything I need. I’m not sure I can scale down anymore, but I will look for ways!
  • I have at least 2 doctor visits a month. Besides the money, it’s very time consuming.
  • I also visit the pharmacy about twice a month. This made me think that I should use mail-order more often, but I realize that most of the time when I see the doctor we are changing doses or meds, so it’s hard to avoid the pharmacy.
  • I logged 1200 miles last year in search of an answer. I have a local headache specialist, but she also referred me to a headache clinic in Philadelphia that has been amazing…but is about 300 miles round-trip.

That analysis makes my head spin! I hope your costs aren’t nearly as crazy as mine. But if you think they might be, maybe itemizing your medical expenses could positively impact your taxes this year. If you haven’t been keeping good records of your expenses, maybe now is the time to start so you can do it next year. Of course, I urge you to consult an accountant or certified tax preparer before filing your taxes. Fingers crossed that we all get big refunds!

This article represents the opinions, thoughts, and experiences of the author; none of this content has been paid for by any advertiser. The Migraine.com team does not recommend or endorse any products or treatments discussed herein. Learn more about how we maintain editorial integrity here.

Comments

  • Katie M. Golden moderator author
    5 years ago

    Ominoggin,
    Thanks for the in-depth explanation!
    And I love your screen name!
    -Katie

  • ominoggin
    5 years ago

    Hi! Thank you Katie, for the great information. My husband and I own an accounting firm, and you would be surprised at the number of people who have no idea about how to count their medical expenses. As you said you do have to have 10% of you adjusted gross income in order to be able to count medical expenses. So, for example if your AGI was $80,000, you would have to have $8,001.00 in order to be able to count $1. Also, you have to have enough on schedule A to go over the amount of the standard deduction, which for people who file Married, filing jointly is $12,200.00 So using the example above of having an AGI of $80,000, not only would you have to have at least $8,001.00 in Medical expenses, you would also have to have at least $4200.00 more of other itemized deductions such as mortage interest, charitable donations, property taxes etc. So you see, the government is making it harder and harder to be able to claim medical expenses. I would, however, like to point out that you may also count your mileage to and from the dr (us with chronic migraine can really rack up those miles), any medical equipment that you might need. I know those with cluster headaches sometimes use oxygen, that expense could be counted. Of course your co-pay to see the dr, medical tests, etc can be counted, as well as the parking fees that you pay when you go to the dr. To end I would just like to say that to have the best chance of counting your medical expenses, you need to keep a record of everything related to medical. Don’t forget the Mileage (write down the odometer reading when you leave home and when you return).and the parking fees!

  • TracyM09
    5 years ago

    Thank you Katie! I keep every hospital receipt for Doctors, Pharmacies and even,parking, however, I didn’t even think about adding up to possibly a deduction! I save them in case Social Security thinks I’ve miraculously healed!! I’m going to do what you said for 2014 and see what happens! Be Well!

  • Steelmagnolia
    5 years ago

    I woke up with one yesterday morning with all the flashing lights and the sick feeling you get when you realize you have gone beyond the “spots in your vision” stage to the “aura/flashing zigzag lights” stage that makes it harder to control, even with your trusted meds for it. I had been working on taxes all day on Monday. I had to finish as much as I could for our appointment today. Thankfully I have found something that will get rid of the worst of it within an hour at the most so I was able to finish up last night.

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