If you paid a lot of medical bills in 2017, you may get a bigger tax break this year. The new tax law includes a retroactive change to the rules for medical expenses that makes it easier to deduct them (if you itemize your deductions).
The old rule: You could only deduct expenses that exceeded 10% of your adjusted gross income (AGI).
The new rule: That 10% is reduced down to 7.5% of AGI - and that means more of us can deduct more medical expenses.
Here's how it works. Let's say your AGI for 2017 was $60,000, and you had $6,000 of medical expenses. Under the old 10% rule, you couldn't deduct a dime. Now, under the 7.5% rule, that floor lowers to $4,500…meaning you can take a $1,500 deduction.
And while most people remember to include payments for doctor visits, dentist visits, prescriptions, and hospital stays, there are many more expenses that count toward this valuable deduction.
Check out these 11 deductible medical expenses that most people don’t know they can claim:
*If your home increases in value due to air conditioning installation, you have to subtract that increase from your expense. That’s the IRS for you.
And there are dozens more – so if you reached (or came very close to reaching) the 7.5% floor for medical expenses, make sure you count absolutely every expense you're entitled to take. You can find the full list here.