Medical and Dental Expenses

 

For tax year 2017, the “Tax Cuts and Jobs Act” which was approved by Congress and signed into law by President Trump on December 22, 2017 changes the threshold to deduct allowable out-of-pocket medical and dental expenses from 10% of adjusted gross income (AGI) to 7.5% of adjusted gross income.

EXAMPLES

Old Law: Your adjusted gross income is $45,000 and the out-of-pocket medical and dental expenses you paid in year 2017 were $7,200. The deductible portion of these expenses would have been $2,700.

$45,000 x 10% = $4,500 (nondeductible portion)
$7,200 - $4,500 = $2,700


New Law:
Your adjusted gross income is $45,000 and the out-of-pocket medical and dental expenses you paid in year 2017 were $7,200. The deductible portion of these expenses is $3,825.

$45,000 x 7.5% = $3,375 (nondeductible portion)
$7,200 - $3,375 = $3,825