Are Medicare Premiums Tax Deductible?

We’re going to look at the general answer to that question as it applies to federal taxes. State tax laws regarding Medicare premiums vary, so for questions on your personal tax preparation, please consult a tax professional in your local area.

Should you deduct Medicare premiums?

Although Medicare premiums are tax deductible, they do not automatically get deducted. Medicare premiums are considered medical expenses, but generally only people with medical expenses greater than 7.5% of their Adjusted Gross Income should consider deducting Medicare expenses on their taxes.

​Confused about your Medicare coverage options? Watch our free video: How to Find the Best Medicare Coverage Without Paying More Than You Need To…

Qualifying Medical Expenses​

Qualifying medical expenses are tax deductible on your federal tax return as an itemized deduction. In order to deduct your Medicare premiums and other medical expenses, you will need to decline the standard deduction and file with itemized deductions instead.

Obviously, this is only a good idea if your itemized deductions are going to total more than the standard deduction. Consult your tax preparer to figure out which option is better for you.

Medical Expense Deduction

Unlike some other itemized deductions, the medical expense deduction can only be taken for medical expenses that total more than 7.5% of your Adjusted Gross Income for the year.

If your AGI was $100,000, that threshold is $7,500. If your medical expenses for the year were $12,000, you would only be able to deduct $4,500, the amount of medical expenses above 7.5% of your AGI.

Healthcare costs to include besides premiums

In addition to premiums, other costs associated with your healthcare can also be included in the medical expense deduction. Things like copays, coinsurance, and costs for medications prescribed by your doctor all should be added together to determine whether the medical expense itemized deduction would be beneficial to you.

For questions about deducting Medicare premiums on your tax returns, please consult a local tax professional.

For questions regarding your Medicare coverage, and to find the plan that best fits your needs, please contact our office at 877-312-1414 or watch our free video that explains how to find the best Medicare coverage for you.