A Brief Summary Of Current Tax Issues – 28th September

doctor explaining health issues and costs to the patient

A Brief Summary Of Current Tax Issues – 28th September

It’s tough to exceed the tax law’s “floor” for medical expenses, so make sure you identify every expense you’re authorized to claim.

State taxes must be remembered. Only medical costs above 7.5% of adjusted gross income may be written off by itemizers. If you’re approaching the 2022 deadline, consider rescheduling medical or dental appointments until 2023. Although most states adhere to this federal law regarding medical bills, there are a few that don’t. For instance, in New Jersey, the excess above 2% of AGI is deductible, whereas, in Arizona, the entire amount of eligible costs is deducted. Find out what the law is in your state.

Abortion-related tax issues. Following the Supreme Court’s decision in Roe v. Wade, some states have passed laws protecting a woman’s right to an abortion, while others have outlawed or severely limited such rights. How do the changes affect medical expense deductions? You may write off certain medical expenses related to abortion in places where it is permitted, including the cost of the operation, travel, and a small amount for accommodation. Abortions carried out illegally are not deducted.

Light it up. At the beginning of this year, marijuana use for recreational, medical, or both purposes was legal in 36 states plus the District of Columbia. But if you consume marijuana on a doctor’s advice, can you claim the cost of getting it as a medical expense on your federal return? According to the IRS, it is currently not permitted. Recent legislative measures, however, would offer chances for deductions. We’ll keep an eye out for any important changes.
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