For many New York residents, medical expenses can represent a significant portion of their annual budget. Whether you’re managing chronic conditions, undergoing surgeries, or covering insurance premiums and prescription costs, you may wonder if you can claim any of these healthcare expenses on your New York State tax return. While the federal government allows certain deductions for qualified medical expenses, New York State has its own tax code, and its treatment of medical deductions is not identical. This blog provides a comprehensive look at whether and how you can deduct medical expenses on your New York State return, and how it compares with the federal rules.
Medical Expense Deductions at the Federal Level
Before diving into New York specifics, let’s briefly review the federal rules. The IRS allows taxpayers who itemize deductions on Schedule A of Form 1040 to deduct qualified, unreimbursed medical and dental expenses that exceed 7.5% of their adjusted gross income (AGI). Qualifying expenses include costs related to the diagnosis, treatment, prevention, or mitigation of disease, and can also include travel to medical appointments, prescription drugs, and certain insurance premiums.
For example, if your AGI is $60,000, only the portion of your medical expenses that exceeds $4,500 (7.5% of AGI) is deductible on your federal return.
Does New York State Allow Medical Expense Deductions?
Yes, but only conditionally. New York State does not allow a separate medical expense deduction beyond what is claimed at the federal level. However, it does conform to the federal system of itemized deductions to a certain degree. If you itemize deductions on your New York State income tax return, you may indirectly benefit from your federal medical expense deductions — but there are key differences and limitations.
In essence, New York does not offer an additional or separate medical deduction. Instead, it allows a limited form of itemized deductions that are derived from your federal Schedule A, but adjusted for New York-specific additions and subtractions.
Standard Deduction vs. Itemized Deduction in New York
New York taxpayers can choose between claiming the standard deduction or itemizing deductions, similar to the federal system. For the 2025 tax year, the standard deduction in New York is:
- $8,000 for Single filers
- $16,050 for Married Filing Jointly
- $11,200 for Head of Household
If your total itemized deductions — including the limited portion of federal itemized deductions allowed by New York — exceed the state’s standard deduction, it makes sense to itemize. Otherwise, you’ll default to the standard deduction, and your medical expenses won’t yield any tax benefit at the state level.
How New York Adjusts Federal Itemized Deductions
New York State requires adjustments to the federal itemized deductions when transferring them to the state return. On New York Form IT-196 (Itemized Deductions), you start with your federal Schedule A totals and then make adjustments as specified by the state.
Notably, medical and dental expenses from federal Schedule A are included in the total deductions reported on line 4 of Form IT-196. However, this figure is subject to New York’s rules, including:
- Limiting total deductions if your federal AGI exceeds certain thresholds
- Eliminating deductions that are not allowed under state law (e.g., certain miscellaneous deductions)
- No special enhancement or exemption for medical deductions beyond what was allowed federally
What This Means in Practice
If your federal itemized deductions included a deduction for medical expenses exceeding 7.5% of your AGI, and you itemize on your New York return, those medical expenses are effectively part of the total you carry over to Form IT-196. However, the benefit is indirect, and it hinges on your decision to itemize rather than claim the New York standard deduction.
If your itemized total — including medical expenses, mortgage interest, property taxes, charitable contributions, and more — is less than the standard deduction, then there’s no state-level tax benefit from medical deductions.
Are There Any Additional Medical Benefits on the NY Return?
New York does not provide additional tax credits or deductions specifically for medical expenses. However, there are other healthcare-related tax benefits for certain situations, such as:
- Long-Term Care Insurance Credit: New York offers a tax credit equal to 20% of the premiums paid for qualifying long-term care insurance policies. This is a separate credit and not part of the itemized deduction process.
- Health Insurance Coverage for Dependents: While not a deduction, some policies allow coverage for dependents up to age 29 under New York’s “Young Adult Option.” This may reduce out-of-pocket costs but has no direct tax implication.
- Health Savings Accounts (HSAs): New York follows the federal treatment for HSAs, allowing deductions for contributions, though it does not tax HSA earnings when used for qualified expenses.
Limitations and Considerations
It’s important to remember the following when considering the impact of medical deductions on your New York State taxes:
- Only taxpayers who itemize at the federal level and whose total deductions exceed the state standard deduction will benefit from including medical expenses on the state return.
- New York does not apply a separate threshold like 10% or 7.5% for state-only purposes. It uses your federal deduction figures as a starting point.
- You must use Form IT-196 to claim itemized deductions on your New York return.
- Medical expenses alone are unlikely to result in tax savings at the state level unless combined with other significant deductions.
Example: When Medical Deductions Help on a NY Return
Let’s say you’re a single filer with a $70,000 AGI in 2025. You have $9,000 in unreimbursed medical expenses. Federally, you can deduct $3,750 (amount over 7.5% of AGI). You also have $5,000 in mortgage interest and $3,000 in charitable contributions. Your total federal itemized deductions are $11,750, which exceeds the standard deduction of $13,850 — so you may choose the standard federally. However, New York’s standard deduction for single filers is only $8,000. If you itemize on your state return using IT-196, you could potentially benefit from using the itemized amount — which includes your federal medical deduction — to reduce your state tax liability.
Documentation and Recordkeeping
If you plan to claim medical expenses on your federal and New York State returns, ensure you maintain detailed records, including:
- Receipts for doctor visits, hospital bills, and surgeries
- Prescription records
- Proof of insurance premium payments (if applicable)
- Mileage logs and transportation receipts for medical visits
- Statements showing what was reimbursed by insurance or Health Savings Accounts
While New York does not require you to submit these documents with your return, they should be available in case of an audit or review by the New York State Department of Taxation and Finance.
Conclusion: Limited but Possible Deduction Path
New York State does not provide a unique or standalone deduction for medical expenses, but it does allow these costs to be included as part of your federal itemized deductions when calculating your New York itemized deductions. The benefit is conditional and indirect — you must itemize and your total deductions must exceed the state’s standard deduction to benefit.
For many taxpayers, this means that large medical expenses will provide greater benefit on the federal return than on the state return. However, by carefully calculating and comparing your options, you may still find tax-saving opportunities when filing your New York return. Consider using tax preparation software or consulting with a CPA to determine whether itemizing makes sense for your specific financial situation.
