The obvious answer is that if your itemized expenses exceed the standard deduction, you should itemize. That being said, if you don’t have the actual receipts and supporting documentation to justify claiming those expenses, then you run the risk of losing those deductions as a result of an audit, which can be costly from an interest and penalties perspective. Not to mention, you’ll likely need to hire a tax professional to assist you with IRS correspondences.
Many existing or soon to be retirees should pay careful attention to the tax breaks that are available to them. As most of us know, when you’re on a fixed budget, every dollar counts. So, what are some of the tax breaks for retirees?
This can be overlooked as many elderly taxpayers may think there’s no chance of deducting these medical expenses. That’s not always true. We’ve seen countless examples of those on dialysis being prescribed specific supplements & vitamins by their doctor that goes beyond just caring for their general health. With the proper support, in those instances, the costs which can be in the several thousand dollar range and possibly greater are eligible deductions. Specifically, if we reference IRS Publication 502 page 16 — it states, “You cannot include in medical expenses the cost of nutritional supplements, vitamins, herbal supplements, “natural medicines,” etc. unless they are recommended by a medical practitioner as treatment for a specific medical condition diagnosed by a physician. Otherwise, these items are taken to maintain your ordinary good health, and are not for medical care.”
We are married and earn about $300,000 per year. My wife is trying to become pregnant and we have already spent $24,000 in fertility treatment. Now we are considering using donor eggs which will cost an additional $42,000 Thus $66,000 in expense in 2015 or we can break it up to $24k this year and $42k next year. Is this type of expense deductible as a “medical expense?” Secondly, would the use of a FSA or HSA have been wise? Third, would it benefit to wait until 2016 to do this procedure and use a HSA or FSA? Fourth, assuming that we would receive some benefit by waiting until 2016, can they have the procedure done now and pay later to move the expense to 2016.