I have nearly the same amount in medical expenses this year as I did last year, but turbo tax calculated the allowed deduction at nearly 1/6 the amount as last year. what changed?

[PeterM · Accepted solution]

Medical Itemized deductions are only allowed to the extent that they exceed 10% of your adjusted gross income (Line 38 of Form 1040). Or, if you (or your spouse) were born before born January 2, 1952, you can deduct the part of your medical (and dental) expenses that exceeds 7.5% of your adjusted gross income.

Look at your 2015 Form 1040 and see how much your Line 38 was, then do the same for 2016. If your 2015 adjusted gross income is lower than your 2016 adjusted gross income...this would lend to the fact that more was allowable last year. Here are some fake numbers to help explain:

1. 2015 adjusted gross income equals $50,000 and medicals bills totaled $7,500, and lets pretend you were not born before January 2, 1952...in this example you would be able to deduct $2,500 for medical expenses because your deduction is limited to the excess of your expenses over 10% of your adjusted gross income (50,000 x .10 = 5,000; then 7,500 - 5,000= 2,500).
2. 2016 adjusted gross income equals $65,000 and medicals bills totaled $7,500, and lets pretend you were not born before January 2, 1952...in this example you would be able to deduct $1,000 for medical expenses because your deduction is limited to the excess of your expenses over 10% of your adjusted gross income (65,000 x .10 = 6,500; then 7,500 - 6,500= 1,000).

[Millerclan05]

thank you so much!! this totally makes sense to me now.