Can I enter medical expenses associated with early IRA withdrawal as both the IRA withdrawal penalty exemption as well as health expenses deduction? Two other related posts I found with conflicting answers:

[Red-Rover]

If I entered medical expenses to help reduce my early withdrawal penalty from an IRA, I should not claim them again in the health expenses section. Is that correct?
That is correct.  By offsetting the early IRA withrdawal, you are getting the tax benefit so you can't claim again as a deduction on your taxes.
By: pk79


I put some of the medical expenses under Henry's IRA. Do I put them again under decuctions & credits
Yes you put them again in Deductions and Credits as a medical expense. I assume the entry you made in Henry's IRA was to exempt a portion of the IRA withdrawal from the 10% early withdrawal penalty. Entry of the amounts as a  medical expense might reduce ordinary taxes.
By: Texas Roger SuperUser

[MargaretL · Accepted solution]

You CAN enter the medical expenses in both sections, as your 10% penalty exception AND as your medical expenses in Deductions & Credits section.  As TexasRoger correctly specified, data entry for 10% penalty exception only reduces the amount of the penalty, but your distribution is still subject to ordinary income tax. Entering your medical expenses under Deductions & Credits will reduce that ordinary tax. 

Also, per IRS: "You can only take into account unreimbursed medical expenses that you would be able to include in figuring a deduction for medical expenses on Schedule A (Form 1040). You do not have to itemize your deductions to take advantage of this exception to the 10% additional tax."

[rtm13]

So for 2019, you can only deduct the portion of medical expenses that exceed 10% of AGI, correct? Is that also true for reducing the 10% penalty on early retirement distributions? In other words, can I still use medical expenses below 10% of AGI as an exemption to the 10% early retirement distribution penalty?

[dmertz]

You are responding to a post that applies to tax years before 2017; the date on the post was corrupted in the movement of this thread from the old Intuit forum.

The threshold for the amount that is exempt from the early-distribution penalty due to unreimbursed medical expenses is defined in the law to be the same as that for deductibility on Schedule A.  For tax year 2018 the threshold is 7.5% of AGI.  For 2019 and beyond it goes back to 10% of AGI.  In other words, the amount of an early distribution that is exempt from penalty under this exception is always the same amount that would appear on Schedule A line 4 if you were to itemize (assuming that the distribution exceeds the Schedule A line 4 amount).