Taxing Definitions

Definition — Laughter and other medical deductions

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Laughter may be the best medicine, but it’s also one you can’t get a tax deduction for. Fortunately, plenty of other medical expenses qualify.

What are those expenses? Here’s a quiz to test your knowledge.

1

As a general rule, when adding up your medical expense deduction, you can include only the medical and dental expenses you paid during the year. Payments for medical or dental care you will receive in a future year are generally not deductible. However, the rule has exceptions.

2

If you didn’t claim a medical or dental expense that would have been deductible in an earlier year, you can

 

or

3

On your 2018 federal income tax return, you can deduct qualified medical expenses that are greater than

 

or

 

4

The standard mileage rate for 2018 for deducting medical-related vehicle expenses is

 

or

5

When you pay for special equipment (or improvements) installed in your home when the main purpose is medical care for you, your spouse, or your dependent, the cost may be partly or fully included as a medical expense. The cost of the improvement must be reasonable and accommodate your home to your disabled condition. Additional costs for personal motives, such as for architectural or aesthetic reasons, aren’t medical expenses.

Say you have arthritis and a heart condition. You can’t climb stairs or get into a bathtub. On your doctor’s advice, you install a bathroom with a shower stall on the first floor of your two-story rented house. The landlord didn’t pay any of the cost of buying and installing the special plumbing and didn’t lower the rent.

True or False: Based on the above information, you can include in medical expenses the entire amount you paid.

 

or

 

NOTE: You can find definitions and descriptions of qualified medical expenses in publication 502, Medical and Dental Expenses. The publication was recently updated to reflect the tax law in effect for 2018 federal income tax returns.

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Note: Taxing Lessons provides a summarized version of sometimes lengthy court decisions and IRS documents. The full documentation may include facts and issues not presented here. Please use the link provided in the post to read the entire document.

This information should not be considered legal, investment, or tax advice. Taxing Lessons and Top Drawer Ink Corp. do not provide legal, investment, or tax advice. Always consult your legal, investment, and/or tax advisor regarding your personal situation.

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Medical expenses paid before death by a decedent are included in figuring any deduction for medical and dental expenses on the decedent's final income tax return. This includes expenses for the decedent's spouse and dependents as well as for the decedent.

The survivor or personal representative of a decedent can choose to treat certain expenses paid by the decedent's estate for the decedent's medical care as paid by the decedent at the time the medical services were provided.

The expenses must be paid within the one-year period beginning with the day after the date of death.

If you are the survivor or personal representative making this choice, you must attach a statement to the decedent's Form 1040 (or the decedent's amended return, Form 1040X) saying that the expenses haven't been and won't be claimed on the estate tax return.

Other exceptions include future care purchased in connection with obtaining lifetime care, and qualified long-term care insurance contracts.
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File Form 1040X, Amended U.S. Individual Income Tax Return, to claim a refund for the year in which you overlooked the expense. Don't claim the expense on this year's return. Generally, a claim for refund must be filed within three years from the date the original return was filed or within two years from the time the tax was paid, whichever is later.
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You can also add parking fees and tolls to your expenses even if you use the standard mileage rate.
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