For taxpayers aged 65 and older, medical and dental expenses may be deductible if they exceed a set portion of your adjusted gross income (AGI) and you choose to itemize on Schedule A. Here’s a comprehensive guide to maximizing your tax benefits.
1. The 7.5% AGI Threshold for Seniors
- In 2025, medical and dental expenses are deductible only to the extent they exceed 7.5% of AGI for taxpayers aged 65 or older—unchanged through 2026. :contentReference[oaicite:0]{index=0}.
- Example: If your AGI is $50,000, only expenses above $3,750 are eligible. A $10,000 bill yields a $6,250 deduction. :contentReference[oaicite:1]{index=1}
2. Qualifying Expenses
Under IRS Publication 502 and Topic 502, you can include:
- Unreimbursed costs for diagnosis, treatment, surgery, hospital stays
- Dental procedures, eye exams, hearing aids, prescription drugs
- Medicare premiums, health and dental insurance (if paid with taxable dollars)
- Transportation costs: mileage, tolls, parking, ambulance fares
- Long‑term care services & insurance; select equipment (e.g. wheelchairs)
These must be unreimbursed and paid within the tax year. :contentReference[oaicite:2]{index=2}
3. Must Itemize to Claim
You cannot take the medical deduction if you use the standard deduction—you must itemize deductions using Schedule A. :contentReference[oaicite:3]{index=3}
4. Itemize vs. Standard Deduction for Age 65+
In 2025:
- The standard deduction is $15,000 (single) or $30,000 (married). Seniors get an extra $2,000 or $1,600 respectively. :contentReference[oaicite:4]{index=4}
- Itemizing only makes sense if total deductions—medical + mortgage interest + SALT + charitable contributions—exceed that sum. Otherwise, standard deduction may yield more benefit. :contentReference[oaicite:5]{index=5}
5. How to Calculate Your Deduction
- Compile all unreimbursed medical/dental expenses paid in 2025.
- Calculate 7.5% of your AGI.
- Subtract threshold from total eligible expenses.
- If result ≥ $0 and you itemize, report that amount on Schedule A.
Example: AGI $60,000 → threshold = $4,500. Expenses $8,000 → deductible amount = $3,500.
Include related expenses such as transportation mileage and insurance premiums if paid out-of-pocket. :contentReference[oaicite:6]{index=6}
6. Additional Tips for Seniors
- Organize receipts: Keep bills, canceled checks and Explanation of Benefits for proof. :contentReference[oaicite:7]{index=7}
- Include dependent expenses: You can also deduct expenses paid for your spouse or qualifying dependents. :contentReference[oaicite:8]{index=8}
- Watch reimbursements: If insurance reimburses later, you must include that reimbursement as income if you deducted the expense earlier. :contentReference[oaicite:9]{index=9}
- Bunch expenses: Plan large procedures (e.g., dental work) in one year to exceed the threshold. :contentReference[oaicite:10]{index=10}
7. Reporting and Forms
- Report on Schedule A, Form 1040/1040‑SR.
- Use IRS Publication 502 for specific expense guidelines. :contentReference[oaicite:11]{index=11}
- Consider consulting a tax professional if expenses are near the threshold or involve complex items like long-term care or reimbursements.
✅ Summary for Seniors
- The 7.5% AGI threshold remains for age 65+ in 2025.
- Only unreimbursed medical/dental expenses above that amount qualify.
- You must itemize deductions to claim this benefit.
- Organizing records, including dependent costs and planning expenses can optimize your deduction.
With careful tracking and strategic timing, seniors can substantially offset healthcare costs through the itemized medical deduction in 2025. Consider comparing your total itemized amount to the enhanced standard deduction to see which maximizes your tax savings.
