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Does it make a big difference on tax returns to enter medical expenses for a tax break? Or is it too much of a hassle to get everything together for not enough profit?


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Does it make a big difference on tax returns to enter medical expenses for a tax break? Or is it too much of a hassle to get everything together for not enough profit?
Depends if you have enough to itemize. If not, you still might be able to use them on your state return.
You can only deduct the amount of unreimbursed Medical Expenses you actually paid over 7.5% of your AGI. And then all your itemized deductions have to be more than the standard deduction to get any benefit (so you would only be getting the benefit of the amount that puts you over the standard deduction). And since the Standard Deduction is increased more people will not need to Itemize.
For 2021 the standard deduction amounts are:
Single 12,550 + 1,700 for 65 and over or blind (14,250)
HOH 18,800 + 1,700 for 65 and over or blind
Joint 25,100 + 1,350 for each 65 and over or blind
Married filing Separate 12,550 + 1,350 for 65 and over or blind
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Does it make a big difference on tax returns to enter medical expenses for a tax break? Or is it too much of a hassle to get everything together for not enough profit?
@jaden-trujillo unless you have A LOT of medical bills that you paid, it's a tall mountain for most to climb.
First, you have to have enough expenses to be able to itemize (medical, mortage interest, SALT, donations).
Second, if you make it over the first hurdle, only the medical expenses that exceed 7.5% of your income are eligible to be deducted in any event.
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Does it make a big difference on tax returns to enter medical expenses for a tax break? Or is it too much of a hassle to get everything together for not enough profit?
When you enter medical expenses in TurboTax, it asks you a whole lot of questions to help you include everything that can be entered. Really what matters in the end is the total of all of it; that is what will go on your tax form, so don't get too frazzled trying to make sure everything is in the "right" category as long as you enter it all, and do not enter anything twice.
If you receive Social Security benefits, your Medicare is deducted from your SS. When you enter the SSA1099 for your Social Security, the amount paid for Medicare flows automatically to the medical expense section of the software, so do not enter it again.
MEDICAL EXPENSES
The medical expense deduction has to meet a rather large threshold before it can affect your return. The amount of medical (including dental, vision, etc.) expenses that will count toward itemization is the amount that is OVER 7.5% of your adjusted gross income. You should only enter the amount that you paid in 2021—do not include any amounts that were covered by insurance or that are still outstanding. Of course, your medical expenses plus your other itemized deductions still have to exceed your standard deduction before you will see a difference in your tax due or refund.
To enter your medical expenses go to Federal>Deductions and Credits>Medical>Medical Expenses
2021 STANDARD DEDUCTION AMOUNTS
SINGLE $12,550 (65 or older + $1700)
MARRIED FILING SEPARATELY $12,550 (65 or older + $1350)
MARRIED FILING JOINTLY $25,100 (65 or older + $1350 per spouse)
HEAD OF HOUSEHOLD $18,800 (65 or older +$1700)
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Does it make a big difference on tax returns to enter medical expenses for a tax break? Or is it too much of a hassle to get everything together for not enough profit?
It might still help on your State return, though.
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