I'm in the tax filing minority. I still itemize.
Medical issues are the primary reason I've been filling out Schedule A for the last few years. Not to bore you with the gory details, but recently I've had a couple of medical scares and surgeries.
Combine those with the requisite multiple physician follow-ups (this afternoon I'm heading to my fifth of sixth doctor appointments this month), continued testing and, of course, prescriptions and let's just say I'm helping many, many doctors pay off their vacation homes and put their kids through college.
The only bright side for me, aside from getting better, is that the combination of all those medical expenses and the continued lower threshold for deducting them has meant the hubby and I get a bigger deduction by itemizing.
And I've done my best to maximize that.
Recording your medical travel: I'm a note taker by nature, which is probably why I ended up in journalism. That tendency has helped me at tax time, too.
Yes, your mileage to and from doctors' exams, as well as picking up medications those docs have prescribed count as itemized expenses. This falls under what the Internal Revenue Service describes as "amounts paid for transportation primarily for, and essential to, medical care."
And it doesn't have to be just for your own illnesses. Parents of an ailing child can include in medical expenses those transportation costs for treatment of the youngster.
And the IRS also accepts some other, shall we say tax side trips, as medical travel deductions. This includes transportation expenses:
- of a nurse or other person who can give injections, medications, or other treatment required by a patient who is traveling to get medical care and is unable to travel alone and
- for regular visits to see a mentally ill dependent, if these visits are recommended as a part of treatment.
Medical travel deduction options: Just like with business travel, your doctor-related car costs can be claimed in one of two ways.
You use the actual auto expenses method. For medical travel, this includes out-of-pocket expenses like the cost of gas and oil. You can't, however, count auto depreciation, insurance, general repair or maintenance expenses here.
If you don't want to bother with keeping track of your actual auto expenses, you can use the standard mileage rate. These are set each year for medical, as well as business and moving costs, based on inflation. It's 20 cents a mile for your 2019 taxes.
Even if you claim the standard rate, don't forget to hang onto those parking and toll receipts. You can add these costs to your medical expenses whether you use actual expenses or the standard mileage rate.
The bottom line is to use the medical travel deduction method that give you the greater tax savings. The IRS offers this example of how to decide:
Bill Jones drove 2,800 miles last year for medical reasons.
He spent $400 for gas, $30 for oil, and $100 for tolls and parking.
Bill figures the actual expenses first, with his total expenses coming to $530.
He then figures the standard mileage amount, multiplying his 2,800
medical miles by 20 cents for a total of $560.
Bill also adds the $100 tolls and parking, giving him a total under the
standard mileage method of $660.
In Bill's case, the $660 from the standard mileage method is more tax advantageous that the actual expenses method.
Other medical travel considerations: Don't have a car? Don't worry.
Cab, ride-share and public transportation costs to doctors, pharmacies and other IRS-approved medical treatments also count.
If the travel is outside your hometown, train or plane fares also can be deducted.
And if it's an emergency, don't forget to include any ambulance service fees that aren't covered by your insurance.
Medical travel only: That insurance coverage caveat is key. While second opinions are a good idea when it comes to many medical situations, you don't get seconds on medical mileage claims.
Basically, the IRS doesn't allow tax break double dipping under any circumstances.
So if your insurance covers your medical travel, you can't claim it.
Similarly, if you are reimbursed for your out-of-pocket medical travel costs from a flexible spending account (FSA) or the health savings account (HSA) associated with your high deductible health plan (HDHP), those amounts can't be claimed as itemized expenses.
Specificity required: OK, you're ready to track those medical miles.
But there's one more thing you need to keep in mind. Make sure your medical travel is just that: for medical purposes only.
Most of us multitask, be it at the office, doing parts of two projects simultaneously; at home, watching TV while paying bills; or in running errands. I do all of that, including mapping out routes where I can get several things done on one local road trip.
But when it comes to counting medical miles, the IRS frowns upon trips that include a trip to the doctor, followed by a stop at the store for milk on the way home as you also pick up your child from a play date before heading home.
That total multipurpose trip's miles don't cut it as far as the IRS is concerned. All your potentially deductible mileage must be discrete in the eyes of the IRS.
A trip to the doctor and just that trip counts as medical mileage. It's the same as the IRS approach to allowable business miles. Just the travel to visit your client — or the travel to your doctor — counts when it comes to allowable tax-deductible miles.
Again, this is why I keep two separate business and medical travel logs. If you're into digital tracking, several apps offer similar record keeping.
Some things don't count: Remember, too, that there are some medical travel costs where the IRS flat out says no.
Transportation expenses you can't count include:
- Going to and from work, even if your condition requires an unusual means of transportation. Sorry, but commuting by any means generally is just a cost you're going to have to bear (unless your workplace offers transportation benefits).
- Travel for purely personal reasons to another city for an operation or other medical care. Yes, it's handy your sister lives in Dallas, which also is home to a top-notch sleep apnea clinic. Enjoy you family get-together. See my earlier discussion of medical multitasking and don't count this combination travel on your taxes.
- Travel that is merely for the general improvement of one's health, even if the trip is made on the advice of a doctor. So, no, that yoga retreat doesn't count.
- The costs of operating a specially equipped car for other than medical reasons.
Still, there are plenty of other medical mileage expenses the IRS does accept.
Worth the record keeping effort: If you're spending what seems like an inordinate amount of time traveling to doctors and labs and treatment facilities, I share your transportation pain.
And you should share my tax travel technique, just in case you find your medical expenses mean that itemizing will work better for you at tax filing time.
Yes, it still takes a lot to be able to claim itemized medical expenses, mileage and all the other costs. But the Tax Cuts and Jobs Act (TCJA) enacted at the end of 2017 lowered the percentage of a taxpayer's adjusted gross income (AGI) that the doctors etc. costs must exceed in order to be claimed.
It went from the Affordable Care Act's scheduled 10 percent of AGI increase for all filers to the 7.5 percent level that had been the norm before the health care law change. The tax extenders that were included late last year in federal funding legislation maintain that 7.5 percent AGI threshold for 2019 and 2020 tax years.
Again, even if your miles don't seem to be that many, they may be just enough help you clear the medical itemized expense hurdle.
And it's always easier to tally those potential Schedule A miles if you've recorded them when they happened, rather than trying to recreate them.
Your record keeping dedication also should convince the IRS that your miles are legit, just in case an auditor one day has some questions.
Now, I'm off to one of my [too many] doctors' appointments. Wish me light traffic and continued improving health!
You also might find these items of interest:
- Medical tax provisions affected in 2020 by inflation
- When health insurance premiums are tax deductible
- Thumbing through the IRS' medical deduction (or not) list