medicare part B deduction for federal and state

[dalibella]

Hello,

I was wondering how deducting medicare part B works for Federal and Tax returns for this year.  I do not receive social security because I get a pension from CALSTRS.

Does Turbotax automatically insert the amount? Is it a set amount? I have been paying almost 600 a month (income increased due to the sale of my home in 2021) so my medical expenses went up considerably.

I am not sure how to do this for 2023 taxes due in 2024.

I would appreciate some advice.

Thanks

D.

[DoninGA]

You enter the Medicare Part B premiums you paid in 2023 as an itemized medical expense on your tax return.

Health care insurance premiums, including dental and vision insurance premiums, and other medical expenses that you paid with out of pocket funds and were not reimbursed are an eligible medical expense that you can deduct using Schedule A for itemized deductions. However, only your total medical expenses that are greater than 7.5% of your Adjusted Gross Income (AGI) can be deducted. Your total itemized deductions reported on Form 1040 Schedule A must be greater than the standard deduction for your filing status to have any tax benefit.

Standard deductions for 2023

Single - $13,850 add $1,850 if age 65 or older
Married Filing Separately - $13,850 add $1,500 if age 65 or older
Married Filing Jointly - $27,700 add $1,500 for each spouse age 65 or older
Head of Household - $20,800 add $1,850 if age 65 or older

To enter your medical expenses -

Click on Federal Taxes (Personal using Home and Business)
Click on Deductions and Credits
Click on I'll choose what I work on (if shown)
Scroll down to Medical
On Medical Expenses, click the start or update button

Or enter medical expenses in the Search box located in the upper right of the program screen. Click on Jump to medical expenses

[VolvoGirl]

You will get a 1099R in January for the pension.  Don't know if they break out the Medicare deduction.  You need to look at your payment statements to see all the deductions.  I have CalPERS and print out my payment stub each month.  But it depends on how they deduct Medicare.   Like PERS reimburses me for the Medicare so I can't deduct it.  

But it takes a lot of medical to be able to deduct it.

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.

[dalibella]

Hello, and thanks for the answer

Does it work the same way for state? Will the amount be automatically inserted after doing the federal return? What if I cannot itemize? Will the state return also not consider the expense?

Thanks I am not sure because some expenses, like donations are treated differently by the state, oh and mind is California.

Thanks again

D

[dalibella]

Hello and thanks for answering.

I wasn't talking about the amount for part A but the one for part B which I have to pay on my own every month. As I explained Medicare raised the amount to about 600 a month after my income went up because I sold my home.  Hopefully it will go down again as I expect my income to be way down.

Thanks

D

[VolvoGirl]

You enter everything on the federal side and it will automatically flow to the state return.  Even if you can't itemize on federal you still should enter all your deductions under federal in case they might be deductible on state.

[VolvoGirl]

If you pay part B on your own you can enter it as a medical deduction subject to the medical limits.  Don't expect your premium to go back down right away.  There may be a lag and take a year or two.

[dalibella]

Ah if figures eh? quick to charge more and slow to reconsider!

Thanks for the answers.

ciao

D

[VolvoGirl]

Just came across this.....

How to lower the IRMAA

Request to lower an Income-Related Monthly Adjustment Amount (IRMAA) | SSA

[bpoinde1959]

when you say "if you pay it yourself" you can itemize the Medicare Part B premium.

I have my Part B premium deducted from my monthly Social Security direct deposit.  I do not make a separate payment;  i.e.  I do not "pay it myself" 

Can I itemize the Part B premium if I have it deducted from my Social Security payment as I do?

I also have Medigap plan G and a Part D drug plan.  Can I itemize them also?

I just turned 65 in Sep 2024.  I am planning my IRA withdrawals and the percent withholdings on them for 2025.  That's why I am asking.

thanks in advance.

[VolvoGirl]

Yes part B is deductible if you itemize and don’t take the Standard Deduction.  I don’t know about the other parts.  If you enter part B when you enter the SSA-1099 it will automatically flow over to Schedule A. 

But 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.

[DoninGA]

@bpoinde1959 If you are paying the Medicare Part B, Part D and Medigap Plan G premiums and are not being reimbursed, those payments can be entered on Schedule A as an itemized medical expense.

Health care insurance premiums, including dental and vision insurance premiums, and other medical expenses that you paid with out of pocket funds and were not reimbursed are an eligible medical expense that you can deduct using Schedule A for itemized deductions. However, only your total medical expenses that are greater than 7.5% of your Adjusted Gross Income (AGI) can be deducted. Your total itemized deductions reported on Form 1040 Schedule A must be greater than the standard deduction for your filing status to have any tax benefit.

Standard deductions for 2024

Single - $14,600 add $1,850 if age 65 or older
Married Filing Separately - $14,600 add $1,550 if age 65 or older
Married Filing Jointly - $29,200 add $1,550 for each spouse age 65 or older
Head of Household - $21,900 add $1,950 if age 65 or older

To enter your medical expenses -

Click on Federal Taxes (Personal using Home and Business)
Click on Deductions and Credits
Click on I'll choose what I work on (if shown)
Scroll down to Medical
On Medical Expenses, click the start or update button

Or enter medical expenses in the Search box located in the upper right of the program screen. Click on Jump to medical expenses

NOTE - When entering your Social Security benefits in TurboTax from the SSA-1099 you enter the amount of the Part B premiums that were paid.  Do not enter those premiums again the Medical Expenses section of the program.

To enter Social Security benefits reported on form SSA-1099

Click on Federal Taxes (Personal using Home and Business)
Click on Wages and Income (Personal Income using Home and Business)
Click on I'll choose what I work on (if shown)
Scroll down to Retirement Plans and Social Security
On Social Security (SSA-1099, RRB-1099), click the start or update button

Or enter ssa-1099 in the Search box located in the upper right of the program screen. Click on Jump to ssa-1099

[xmasbaby0]

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 2024—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

2024 STANDARD DEDUCTION AMOUNTS

SINGLE $14,600    (65 or older/legally blind + $1950)

MARRIED FILING SEPARATELY $14,600    (65 or older/legally blind + $1550)

MARRIED FILING JOINTLY $29,200    (65 or older/legally blind + $1550)

HEAD OF HOUSEHOLD $21,900    (65 or older/legally blind + $1950)