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Are Medicare premiums tax deductible?

Yes, your Medicare premiums can be tax deductible as a medical expense if you itemize deductions on your federal income tax return.

If you’re self-employed, you may be able to deduct your Medicare premiums even if you don’t itemize. Another way to get a tax benefit for Medicare premiums: You can withdraw money tax free from a health savings account (HSA) to pay Medicare premiums for yourself and your spouse if you’re 65 or older.

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Can I deduct Medicare premiums as a medical expense?

Yes, if you first meet two requirements:

  • You must itemize your deductions on your tax return.
  • You can deduct medical expenses only after they add up to more than 7.5 percent of your adjusted gross income (AGI).

AARP successfully fought to keep the deduction threshold from rising to 10 percent, and now the 7.5 percent is permanent. For example, if your AGI is $50,000, you can deduct medical expenses in excess of $3,750. If you had $5,000 in eligible medical expenses, you could deduct $1,250 on your income tax return.

What are the rules for itemizing deductions?

To write off a portion of your health care costs, you must keep your receipts and other records and itemize your deductions rather than take the standard deduction. To make this worthwhile, your total itemized deductions — including but not limited to charitable gifts; eligible medical expenses; up to $10,000 in local and state income, property or sales taxes; and tax-deductible mortgage interest — must be more than the easier-to-claim standard deduction.

You have until the April 18, 2023, tax-filing deadline to deduct eligible premiums and other expenses you paid in 2022.

What’s your standard deduction?

The Tax Cuts and Jobs Act of 2017 increased the standard deduction significantly, and the amounts rise annually based on inflation.

  2022 2023
Single $12,950 $13,850
Married couple, filing jointly $25,900 $27,700
Single, 65 and older $14,700 $15,700
Married couple, both 65 and older, filling jointly $28,700 $30,700

Note: If one spouse is younger than 65, the standard deduction will be less.

Source: IRS

What Medicare expenses are tax deductible?

If you qualify, you can deduct Medicare and other related insurance premiums when you itemize, including:

Medicare Part A although most people don’t have to pay Part A premiums.

Medicare Part B, which was $170.10 a month for most people in 2022, decreased to $164.90 in 2023. The premiums can still be tax deductible even if they’re deducted automatically from your Social Security benefits. If you have to pay a high-income surcharge for Part B premiums — also called the Income-Related Monthly Adjustment Amount (IRMAA) — your full premiums can still be tax deductible.

Medicare Part D prescription plans, including the high-income surcharge.

Medicare Advantage, the private alternative to original Medicare.

Medicare supplement insurance, the private plans also known as Medigap.

Long-term care insuranceYou can deduct a portion of premiums you pay for eligible policies based on your age. For premiums paid in 2022, the limits were:

  • $450 if you were 40 or younger.
  • $850 for age 41 to 50.
  • $1,690 for age 51 to 60.
  • $4,510 if you were 61 to 70.
  • $5,640 if you were 71 or older.

These limits are per person. Married couples filing a joint tax return can each deduct their long-term care premiums up to the limits for their age.

The limits for the 2023 tax year, when taxes will be due April 15, 2024, will increase:

  • $480 for age 40 or younger.
  • $890 for age 41 to 50.
  • $1,790 for age 51 to 60.
  • $4,770 for age 61 to 70.
  • $5,960 if you are 71 or older.

In addition, many other out-of-pocket medical expenses can be tax deductible if other insurance, such as Medigap, Medicare Advantage or retiree coverage, didn’t reimburse you. Some of these eligible costs may include:

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Deductibles and copayments.

Most dental, hearing and vision expenses, such as contact lenses, eyeglasses, routine eye exams, dental procedures, dentures, routine dental exams, hearing aids and hearing exams. You can also include the cost of eye surgery to treat defective vision, such as laser eye surgery or refractive surgery to correct myopia or nearsightedness.

Medical equipment, including crutches or a wheelchair, that may not be covered in full. Medical supplies such as bandages are also tax deductible.

Certain home improvements to accommodate a disability. For example, you can deduct the cost of constructing wheelchair ramps, installing bathroom grab bars and handrails, and widening doorways and hallways. If the improvement increases the value of the home, a portion of the expense will not be tax deductible.

Certain psychologist or psychiatrist care costs, even if they exceed Medicare’s coverage limits for mental health benefits.

Services Medicare doesn’t cover, such as acupuncture or chiropractor visits beyond the limited definition of Medicare coverage.

Many travel expenses to receive medical care. But lodging costs may have a daily maximum.

See IRS Publication 502, Medical and Dental Expenses, for a full list of eligible expenses and rules.

What Medicare expenses are not tax deductible?

You can’t deduct the following Medicare-related expenses.

Cosmetic surgery to improve your appearance unless the surgery addresses problems resulting from an accident, deformity or disease. Face-lifts, hair removal, hair transplants, liposuction and teeth whitening are generally not tax deductible.

Late enrollment penalties added to Part B or Part D premiums.

Nonprescription medications, except for insulin. That includes herbal, nutritional or vitamin supplements, unless a medical provider recommends them as treatment for a specific medical condition a physician has diagnosed.

Can I deduct Medicare premiums if I’m self-employed?

If you’re self-employed, you may be able to deduct premiums for Medicare or other eligible health insurance from your income without having to itemize or meet the 7.5 percent threshold. Even if you were primarily retired but did some consulting work, you may be eligible to deduct all or part of your premiums.

You can qualify for the self-employed health insurance deduction only if neither you nor your spouse were eligible to participate in an employer-subsidized health plan. The tax-deductible premiums cannot exceed the amount of money you earned from your business. The calculation is more complicated if you received a subsidy for buying health insurance on the federal or a state insurance marketplace.

If you qualify, you can deduct premiums for Medicare Part B and Part A if you’re required to pay them, as well as Part D, Medicare Advantage and Medigap premiums, and eligible long-term care insurance premiums.

You can claim this deduction as an adjustment to income on Schedule 1 when filing your Form 1040.

Can I use my HSA to pay Medicare premiums?

Yes, if you’re 65 or older. If you saved money in a health savings account (HSA) before you enrolled in Medicare, you may be able to withdraw money from it tax free to pay for Medicare premiums and other out-of-pocket medical expenses.

However, you can’t double-dip and take both tax-free HSA withdrawals and a tax deduction for the same medical expenses.

While you can’t make new contributions to an HSA after you enroll in Medicare, you can withdraw the money without penalty for eligible medical expenses at any age. This includes your costs for insurance deductibles and copayments, most medical expenses that qualify for a tax deduction, plus a few additional expenses, such as over-the-counter medications.

If you’re 65 or older, you can also withdraw money tax free from an HSA to pay premiums for Medicare Part A, Part B, Part D prescription plans and Medicare Advantage. However, the IRS doesn’t allow tax-free HSA withdrawals for Medigap premiums at any age.

Keep in mind

Even though Medicare premiums are tax deductible, premiums paid for employer health insurance usually are not. If you’re still working and have health insurance there, you generally pay those premiums with pretax money.

In that case, you’re already getting a tax break for your health insurance premiums. So you can’t take a deduction for them, too.

Updated February 8, 2023


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