Claiming Healthcare costs on US Taxes.

[turk56]

This question is for the US Retirees: Do you claim all of your healthcare (Physician/Dental/Labs/Medicine/etc.) costs on your taxes?

[Jingthing]

Should be in the home country forum.

[noise]

Are you asking assuming those costs exceed the required percentage of income?  Or just asking to see if it is acceptable for epxats to make that claim?

The IRS lets you deduct medical costs on your tax return as long as they are more than 10% of your adjusted gross income. (Taxpayers who are 65 or older can still use the previous 7.5% threshold to claim itemized medical expenses through the 2016 tax year.)

[turk56]

12 hours ago, noise said:

Are you asking assuming those costs exceed the required percentage of income?  Or just asking to see if it is acceptable for epxats to make that claim?

The IRS lets you deduct medical costs on your tax return as long as they are more than 10% of your adjusted gross income. (Taxpayers who are 65 or older can still use the previous 7.5% threshold to claim itemized medical expenses through the 2016 tax year.)

Judging that I will no longer have the income I am having now, I will most likely exceed the 10% adjusted gross income threshold after reaching the age of 65. That is barring that a catastrophic medical condition does not take place in my late 60s.

[Jingthing]

It's a good question.

Why should it matter if you're an expat ... we still have to file (when required). 

[taxout]

Living overseas, you can deduct medical expenses on the same basis and subject to all the same restrictions that would apply if you were living in the U.S.

 

At least a couple of these restrictions might impact you living in Thailand.

 

First, you can't deduct medical expenses paid on behalf of a dependent relative unless the relative is a U.S. citizen, or a resident of the U.S., Canada or Mexico. So while mother-in-law health care expenses might be deductible while living in the U.S. if your mother-in-law lives there and qualifies as your dependent, while living in Thailand they won't unless she's also a U.S. citizen.

 

Second, prescription drug expenses must be for drugs that are legal both in Thailand and the U.S. "You can include the cost of a prescribed drug you purchase and consume in another country if the drug is legal in both the other country and the United States."

 

https://www.irs.gov/publications/p502/ar02.html#en_US_2015_publink1000179071

[gk10002000]

Being ,or not being an Expat may not have any direct bearing on you, but as Taxout mentions related deductions may be an issue.  In order to deduct medical expenses you of course have to file schedule A and itemize your deductions.  It is quite likely you could have a lot of resistance and questions and even audit issues with the IRS when you try to declare and have the IRS accept your medical expenses in Thailand.  Are you going to give them a receipt that is 50% written in Thai, or show direct withdrawals from your Thai bank?  Ignorant IRS agent may assume you are BSing and claiming a resort and massage and spa, etc.  That receipt from the Thai doctor on Soi Bukhao looks nice, and may be perfectly valid but possibly not to the average IRS agent.   I can see many possible issues.    

[thaihome]

On 8/2/2016 at 9:25 PM, turk56 said:

Judging that I will no longer have the income I am having now, I will most likely exceed the 10% adjusted gross income threshold after reaching the age of 65. That is barring that a catastrophic medical condition does not take place in my late 60s.

 

Even assuming a reduced income to 65k baht a month (the retirement extention threshold), that would mean you are expecting to spend some 70k baht a year in non reimbursed medical expenses in Thailand? 

TH 

[Jingthing]

 

Even assuming a reduced income to 65k baht a month (the retirement extention threshold), that would mean you are expecting to spend some 70k baht a year in non reimbursed medical expenses in Thailand? 

TH 

Why would you assume he has that income? Many expats qualify based on Thai bank accounts and not income. The income required for that is zero.

[thaihome]

4 hours ago, Jingthing said:

Why would you assume he has that income? Many expats qualify based on Thai bank accounts and not income. The income required for that is zero.

The poster said he expected to spend at least 10% of his retirement income on health care. I was attempting to make a minimum estimate of what that would be a year. It sounded like a lot to me.

TH