With the ever-increasing cost of health care, you should be ever-vigilant in looking for chances to claim tax breaks for medical expenses. Here’s the story on health-insurance premiums that you can potentially deduct on your 2014 return.
As an individual taxpayer, you can potentially claim an itemized deduction for qualified medical expenses, including health-insurance premiums. However, to actually claim a deduction on your 2014 return, your total qualified expenses, including eligible health insurance premiums, must exceed 10% of your adjusted gross income (AGI) or 7.5% of AGI if you, or your spouse if you are married, was age 65 or older as of Dec. 31, 2014. AGI is the number at the bottom of the first page of your Form 1040; it includes all taxable income items and selected deductions such as alimony paid, student loan interest (up to $2,500), and moving expenses.
If your total qualified medical expenses don’t exceed the applicable percent-of-AGI threshold, you get no write-off. Sorry. That’s why it’s important to identify all qualified expenses that you can throw in the pot, including health-insurance premiums.
In the medical expense pot, you can include premiums for health policies that cover doctors and hospitals (so-called major medical coverage), dental care, vision care, and specialized health policies that cover things like accidents and cancer. You cannot deduct premiums for insurance that cover loss of limbs or loss of earnings due to illness or injury.
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