What Medical Expenses are Tax Deductible?

Wondering what medical expenses are tax deductible? You’re not alone—many taxpayers overlook potential savings simply because they don’t know the rules. If you’ve had a rough year health-wise or just want to make the most of your out-of-pocket costs, it pays to understand how the IRS treats medical deductions. At Del Real Tax, we help individuals and small business owners across Chicago navigate these details so nothing gets left on the table.

Who Can Claim Medical Expense Deductions?

You may be eligible to deduct medical expenses—if you know where to look. Medical expense deductions are only available to taxpayers who itemize on their return, which means skipping the standard deduction. But if your eligible medical care costs were high this year, itemizing might save you more in the long run. You can claim unreimbursed expenses for yourself, your spouse, or your dependents. In some cases, even paying medical bills for a parent or adult child might count, as long as you provided over half of their support.

Common Tax-Deductible Medical Expenses

Many people are surprised to learn how broad the list of deductible expenses can be. The IRS allows deductions for a wide range of services and treatments—as long as they’re necessary to diagnose, treat, or prevent a physical or mental illness. Here are some common examples:

• Doctor visits and specialist care (including physical therapy and chiropractic services)

• Hospital stays and surgical procedures

• Dental care, such as cleanings, fillings, and even braces

• Prescription medications

• Vision care like eye exams, prescription glasses, contact lenses, and LASIK surgery

• Mental health treatment, including therapy, counseling, and psychiatric care

• Medical devices like wheelchairs, hearing aids, and prosthetics

• Transportation costs related to medical appointments (mileage, tolls, parking, or ambulance rides)

• Long-term care services, if they meet IRS qualifications

• Health insurance premiums, in some situations (like if you’re self-employed)

• Lesser-known deductible items, including addiction recovery programs, acupuncture, doctor-prescribed smoking cessation treatments, and weight-loss programs for diagnosed medical conditions

Not sure if your expenses qualify? Del Real Tax offers personalized consultations to help you maximize your deductions—or check out other common work expense tax deductions you might be missing.

What Medical Expenses Are Not Deductible?

Just because it’s health-related doesn’t mean it’s deductible. The IRS draws a firm line between necessary medical care and general wellness or personal expenses. For example, you can’t deduct:

• Over-the-counter medications (like ibuprofen or vitamins)

• Cosmetic procedures (unless they are medically necessary due to trauma or disease)

• Gym memberships or weight-loss programs (unless prescribed by a doctor and documented)

• Non-prescription supplements

• Childcare or maternity clothing, even during pregnancy

• Funeral or burial expenses

• Expenses paid in a different year, even if they relate to care received during the tax year

Understanding what doesn’t qualify is just as important—these mistakes are common on self-filed returns and can raise red flags.

How to Claim Medical Expenses on Your Tax Return

Claiming qualified medical expenses is easier than you think—if you follow the right steps. You’ll need to file Form 1040 and attach IRS Schedule A (Itemized Deductions), which is used to list qualified expenses and calculate what portion is deductible. The catch? You can only deduct the amount that exceeds 7.5% of your adjusted gross income (AGI).

Here’s a quick step-by-step:

1. Total all qualifying medical and dental expenses for the year

2. Multiply your AGI by 0.075 (7.5%)

3. Subtract that number from your total expenses

4. Enter the remainder on Schedule A

Example: If your AGI is $60,000, then only the portion of medical expenses above $4,500 ($60,000 x 0.075) is deductible. So if you spent $7,000, you’d be able to deduct $2,500. Note: Only medical expenses paid during the calendar tax year are eligible, even if the care took place earlier.

Should You Itemize or Take the Standard Deduction?

The standard deduction is tempting—but it might not always be your best option. For 2025, the standard deduction is $14,600 for single filers and $29,200 for married couples filing jointly. If your total itemized deductions (including medical expenses, mortgage interest, and state/local taxes) exceed that amount, then itemizing is the smarter route.

Many of our clients at Del Real Tax find that high medical bills—especially after surgeries, childbirth, or chronic care—push them past the standard deduction threshold.

And if you’re a small business owner, proper planning can make a difference—see how outsourcing payroll can impact your taxes.

Also, if you’re eligible for the Child Tax Credit, itemizing deductions won’t affect it—but the savings from both can combine for a larger federal tax refund.

Pro Tips to Maximize Your Medical Expense Deductions

Don’t leave money on the table—these simple habits can add up to real savings at tax time. Here’s how to get the most out of your medical deductions:

• Track expenses throughout the year in a spreadsheet or bookkeeping app

• Bundle non-urgent care into the same year to surpass the 7.5% threshold

• Use an HSA or FSA, which can provide tax advantages even without itemizing

• Save every receipt, statement, and doctor’s note

• Ask your provider for detailed billing statements in case of an audit

• Track mileage and travel costs for medical visits—these add up fast. For 2025, the IRS medical mileage rate is [insert current rate]% per mile. That includes trips to the doctor, dentist, pharmacy, or hospital.

A good tax professional can help you uncover deductions you didn’t even know you had—and make sure you’re audit-ready.

What Records Should You Keep?

Being organized is half the battle when it comes to claiming deductions. To stay prepared, keep a folder (digital or physical) with:

• Medical receipts and invoices for payments

• Statements from health insurance companies showing what was covered or reimbursed

• Prescription documentation and physician letters (especially for weight loss, addiction, or mental health treatment)

• Mileage logs for travel to appointments and pharmacies (date, purpose, distance)

• Bank or credit card statements to confirm payment dates

These records are crucial if the IRS ever questions your claim. Learn more about audit triggers and how to avoid them.

Real-Life Example: Chicago Couple Saves Big

One of our clients, a married couple from the West Loop, had unexpected medical expenses when both partners underwent procedures in the same year. Their AGI was $80,000, and they spent $10,000 on hospital bills, therapy, and prescription drugs. Since 7.5% of their AGI was $6,000, they could deduct $4,000—something they would have missed entirely if they’d taken the standard deduction. That $4,000 deduction helped them boost their federal tax refund by over $1,000.

FAQ – Medical Expense Deductions

Q: Can I deduct health insurance premiums?
A: Yes, but only if you pay them out-of-pocket and aren’t reimbursed by your employer. Self-employed individuals may also qualify for a separate deduction.

Q: Do I need to keep receipts?
A: Absolutely. You’ll need to show proof in the event of an IRS audit. Digital or paper copies are both acceptable.

Q: What if my insurance reimbursed me?
A: Only unreimbursed medical expenses are deductible. If you got a payout, that amount doesn’t count.

Q: Can I deduct HSA or FSA expenses?
A: No, because those accounts already provide pre-tax benefits. You can’t “double dip.” But if you contribute to a Health Savings Account (HSA), you get a deduction for contributions, and tax-free use of funds for qualified medical care.

Q: Can I deduct medical costs for a parent or relative I support?
A: Maybe. If you pay over 50% of their support and they meet IRS dependent criteria, you could be eligible.

Q: Where can I find the full list of eligible expenses?
A: The IRS publishes a full breakdown in Publication 502.

Get Help From a Trusted Chicago Tax Accountant

Medical and dental treatment expenses can take a serious toll—but the tax code gives you a chance to recover some of those costs. At Del Real Tax, we help individuals, families, and small business owners in Chicago get clarity on their tax situation and uncover every legal deduction available. Whether you’re managing chronic medical care, budgeting for prescription drugs, or trying to qualify for the child tax credit, we’ll help you position your return for the biggest possible federal tax refund. Need expert guidance? Schedule a free consultation or call us at 708-788-0082 to learn more.