How to Claim Medical Expenses as a Tax Deduction (2025 Guide)

Introduction

Medical expenses can be a significant financial burden, but the IRS allows taxpayers to deduct qualified medical costs that exceed a certain percentage of their adjusted gross income (AGI). If you have high medical bills, you may be able to reduce your taxable income by claiming them as an itemized deduction. This guide explains the rules, IRS tax codes, forms, and step-by-step instructions to help you claim medical expenses in 2025.

Medical Expense Deduction Threshold (IRC §213)

The IRS allows you to deduct qualified medical expenses that exceed 7.5% of your AGI.

Key Points:

• You must itemize deductions using Schedule A (Form 1040) instead of taking the standard deduction.
• Only unreimbursed medical expenses (not covered by insurance or paid by an employer) qualify.
• Applies to medical expenses for yourself, spouse, and dependents.

Example:

Emma has an AGI of $50,000 and $6,500 in qualified medical expenses. Since 7.5% of her AGI is $3,750, she can deduct the amount exceeding this threshold:

• $6,500 – $3,750 = $2,750 deductible amount (claimed on Schedule A).

What Medical Expenses Are Deductible? (IRC §213(d))

The IRS defines qualified medical expenses as those paid for the diagnosis, treatment, prevention, or cure of a disease.

Common Deductible Medical Expenses:

• Doctor visits, hospital care, and surgeries
• Prescription medications
• Dental and vision care (glasses, contact lenses, dental treatments)
• Mental health therapy and counseling
• Long-term care services
• Medical equipment (hearing aids, wheelchairs, crutches)
• Home modifications for medical reasons (e.g., wheelchair ramps)
• Travel expenses for medical care (mileage, parking, tolls, airfare)

Non-Deductible Medical Expenses:

• Over-the-counter medications (unless prescribed)
• Cosmetic procedures (unless medically necessary)
• General health expenses (gym memberships, vitamins, diet programs)

How to Claim Medical Travel Expenses (IRC §213(d)(1)(B))

If you travel for medical treatment, you can deduct transportation costs, including:

• Mileage at the IRS-approved medical mileage rate ($0.22 per mile for 2025)
• Public transportation, taxis, or rideshare fees
• Airfare and lodging (up to $50 per night per person) if required for out-of-town medical care

Example:

David drove 600 miles for chemotherapy treatments.

• 600 miles × $0.22 = $132 deductible as a medical travel expense.

Long-Term Care and Nursing Home Deductions (IRC §213(d)(1)(C))

If you or a dependent require long-term care, certain expenses may be deductible.

Deductible Expenses:

• Long-term care services if medically necessary
• Nursing home care if primarily for medical treatment
• Premiums for qualified long-term care insurance (subject to IRS limits based on age)

Example:

Sarah, age 65, paid $4,500 in long-term care insurance premiums in 2025. The IRS limit for her age group is $4,770, so she can deduct the full amount.

Health Savings Account (HSA) and Flexible Spending Account (FSA) Contributions

• You cannot deduct medical expenses paid with HSA or FSA funds because they are already tax-advantaged.
• HSA Contribution Limits (2025): Up to $4,150 (self-only) or $8,300 (family).
• FSA Contribution Limit (2025): Up to $3,200 per year.
• If medical costs exceed these contributions and are paid out-of-pocket, they may qualify for a deduction.

Step-by-Step Guide to Claiming Medical Expense Deductions

1. Determine If You Qualify: Ensure total medical expenses exceed 7.5% of your AGI.
2. Gather Documentation: 
   • Receipts for doctor visits, prescriptions, and medical equipment.
   • Mileage logs for medical travel.
   • Insurance statements showing out-of-pocket payments.
3. Decide Whether to Itemize: 
   • Compare your total itemized deductions (Schedule A) to the standard deduction ($13,850 single, $27,700 married filing jointly in 2025).
   • If itemized deductions exceed the standard deduction, itemizing is better.
4. Complete Schedule A (Form 1040): 
   • Enter your total unreimbursed medical expenses on line 1.
   • Calculate your deduction by subtracting 7.5% of AGI from your total expenses.
5. File Your Tax Return: Use tax software or consult a CPA for accuracy.

Conclusion

If you had high medical expenses in 2025, you might be eligible for a tax deduction. Keeping detailed records and understanding IRS rules can help you reduce your taxable income.

Need help? Schedule a consultation with Anshul Goyal, CPA EA FCA to ensure you claim the right deductions.

Disclaimer

This article is for informational purposes only and should not be considered tax, legal, or financial advice. Tax laws change frequently, and individual circumstances vary. Consult a qualified tax professional, such as Anshul Goyal, CPA EA FCA, before making any tax-related decisions.

FAQs

1. What medical expenses can I deduct in 2025?
You can deduct doctor visits, prescription drugs, hospital stays, dental and vision care, mental health therapy, and medical travel costs.

2. What percentage of medical expenses is tax deductible?
Only expenses that exceed 7.5% of AGI are deductible.

3. Can I deduct over-the-counter medications?
No, unless prescribed by a doctor.

4. Can I deduct health insurance premiums?
Generally, only self-employed individuals can deduct premiums. Employer-sponsored health plan premiums are not deductible.

5. What form do I use to claim medical expenses?
Use Schedule A (Form 1040) to itemize deductions.