Can I Claim Medical Bills from Previous Years?
Typically you should claim medical bills and expenses on the year’s tax return that is for the year in which you paid for the expenses. So for example, if you paid for a particular treatment in 2018, you should claim that expense on your tax return for 2018. Even if you pay for a treatment in 2018, such as toward the end of the year, but do not receive part or all of the treatment until 2019, you should still claim the expense on your 2018 tax return.
If you work with a CPA, they can answer questions you might have about the year in which you should claim particular medical expenses.
How to File Your Medical Expense Deduction
It is fairly straightforward to file your medical expense deduction for any year in which you have that type of expense. As you are completing your tax return for the year, you will include your medical expenses on Schedule A of the 1040 form. Do the following:
1. On Line 1 of the form, write or enter the amount that is the total of medical expenses for the year.
2. On Line 2 of the form, write or enter your adjusted gross income that you entered on Line 38.
3. On Line 3 of the form, enter the number that is your adjusted gross income multiplied by 0.075. This number is your deduction threshold.
4. On Line 4 of the form, enter your medical expenses deduction amount. You get that number by subtracting the deduction threshold from your total expenses.
If you work with a CPA, tax preparer or tax software, you may not have to do as many of these calculations, or the process for calculating numbers might be more automated.
Helpful Reminders for Medical Expenses and Deductions
Remember to keep all of your medical expense receipts in a safe place along with all of your other documentation pertaining to your tax return. You may need that information if your tax return is ever audited.
Claiming medical expenses on your tax return can help you to come out further ahead on your taxes in the form of receiving a larger tax refund than you would have received if you did not claim medical expenses. Or it might help to reduce the amount of taxes that you owe. Of course, you still have to pay the medical expenses as you incur them, and that can be a particular challenge when the expenses are high or sudden and unexpected. But the good news is that there is assistance available, so for example many people discover it is possible to get a loan for medical bills.
Conclusion
Keep all your medical expense information organized throughout the year to make it easier when it comes time to complete and file your annual tax return.
Remember that the rules for many tax-related issues, including medical expenses and deductions, can change from year to year. Stay informed so you will know how best to handle your medical expenses and deductions each year.