Medical expenses †deductibility in personal income taxation

national Income tax code specifies the generally deductible expenses in the psycheal taxation of an single(a) which include medical checkup examination expenses, plastered taxes, mortgage interest, investment interest and charitable contri censures. These deductions mentioned in the chapter be cognize as itemized deductions. It has to be noted that almost(prenominal) usances not specifically allowed as itemized deductions be not allowable against the personal income subject to tax.Medical expenses nonrecreational come on by the taxable unmarried on himself-importance, spouse and low-levels argon allowed as an itemized deduction. The additional points to be noted be that the deduction is allowed lone(prenominal) to the extent to which the medical expenses are not reimbursed and the deduction is limited to 7.5% of the taxpayers adjusted Gross Income.1.0 DEFINITION OF checkup EXPENSESThe definition of medical expenses is very unsubtle to cover not only the expenses incurred for the diagnosis, cure, mitigation, handling, or pr heretoforetion of the disease but also covers expenses incurred for preventive health cover and costs of periodic sensual and dental examinations of the taxpayer. The important point here is that such(prenominal) deductions are allowed even when the taxpayer is in good health. Hence, such medical expenses incurred for the treatment of diseases affecting any structure or function of the body are termed as medical expenses for the purpose of assessing the income for tax purposes.2.0 COSMETIC SURGERY-DEDUCTIBILITYExpenses incurred for Cosmetic Surgery are deductible when the surgery is necessary toamelioratea deformity arising from a welcome abnormality or a personal injury or A disfiguring disease.Any medical expenses incurred on cosmetic surgery for purposes otherwise than those which are unnecessary are not deductible. For example, fees paid to a cosmetic sawbones for a face lift of a person of 75 historic period ag e to improve his appearance is unnecessary and hence not deductible. tho the cost of restoring the face by cosmetic surgery, which is disfigured in an accident, is deductible.3.0 DEDUCTIBILITY OF accredited OTHER EXPENSES4.1 COSTS INCURRED IN A NURSING foot/HOME FOR AGEDWhen a person is admitted in a nursing kinsfolk or home for the aged primarily to get medical care, and then the expenses incurred for the nursing home expenses including meals and caparison are allowable as a deduction. However if the primary concern for being admitted to the nursing home or the home for aged is personal, only the expenses paid for medical or cursing is deductible, whereas, costs of lodging and meals are not deductible.4.2 TUITION EXPENSESWhen a myrmecophilous is sent to a school having special resources for alleviating the infirmities caused by mental or physical disability, the tuition expenses paid to the school is an allowable deduction. In such cases, the cost of meals and lodging in ad dition to the tuition fees is allowable.4.3 MEDICAL EXPENSES INCURRED FOR cooperator AND DEPENDENTSA taxpayer is entitled to claim the deduction in his adjusted make income of the medical expenses incurred by him on his/her spouse and for a person who is dependent on him/her at the time such expenses were incurred. Again the dependency is to be determined on the basis of certain criteria as spelt place in the Act and the schedules.4.4 EXPENSES INCURRED ON TRANSPORTATION, MEALS AND LODGING FOR MEDICAL TREATMENT fare costs like bus, taxi, train or plane fare, charges for ambulance services and out of pocket expenses for the use of an automobile for commuting to and from a point of treatment for medical care are deductible. The taxpayer is entitled to choose either a mileage allowance or actual out-of-pocket automobile expenses. conclusion is allowed for the related parking fees and toll charges, whereas the cost of meals, en route are not allowed as a deduction. likewise the cost of transportation of a parent accompanying a sick child or a nurse or other attendant accompanying a person who is traveling to get medical care is allowable, provided it is so that the patient brook not travel only and needs an aid to accompany during the journey.The lodgement expenses which are incurred essentially for medical care, when the medical care is provided by a recompense in a licensed hospital or clinic are allowed as deduction. No lavish or extravagant lodging expenses involving operative element of personal pleasure recreation or vacation in the travel away from home is allowed as deduction. The limit for such lodging expenses pensionable for deduction is $50 per night for the patient as thoroughly as the person who must accompany the patient.4.5 ALLOWABILITY MEDICAL INSURANCE PREMIUMS AS DEDUCTIONThe maximum limit of 7.5 % of the adjusted flagrant income of the taxpayer allowable as deduction include the medical insurance subventions, irrespective of the fac t that such aids are paid under a group or individual plan. When the medical insurance premium is paid by the employer such premium is not included in the income of the taxpayer and it cannot be included in the employees medical expense either. Insurance premiums paid by a self employed person are allowed as a business income. The premium paid for the spouse and dependents also qualify for deduction. Premiums paid by companies on their employees health care is allowed as business expenditure for the companies concerned.4.0 DEDCUTION OF CAPITAL EXPENDITURES INCURRED FOR MEDICALPURPOSESWhen swimming is a part of a medical treatment and at that place is no availability of a neighborhood pool then the capital of the United States expenses incurred on constructing such pool will become eligible for deduction. Similarly a Window Air-conditioner which is not permanent in nature, dust reasoning by elimination system, elevators and a room built to house an iron lung are some of the exampl es of allowable capital expenditure. The basic criteria in determining the allowability of such expenditure is that they are required as medical necessity upon the advice of a doctor or physician, the facility is used primarily by the patient alone and the expenditure is reasonable.Similarly expenditure like constructing entrance and exit ramps to the star sign widening hallways and doorways to accommodate wheelchair, installing support bars and railings in bathrooms and other living rooms and adjusting any electrical outlets or fixtures offer themselves eligible for deduction provided that the expenditure is incurred to enable a physically handicapped individual live independently and productively. If a capital expenditure is allowed as a medical expense, then the allowable cost is deductible in the course of study incurred. All these expenses are allowed subject to the overall ceiling of 7.5% of the adjusted gross income.5.0 DEDUCTION ARE ALLOWED ON A CASH BASISany(prenominal) b e the method of accounting adopted by the individual, the medical expenses are deductible on a cash basis. This means that the are deductible only in the year in which they are paid with an exception in the case of deceased person, when the expenses are paid within a year of death then the expenses would be deemed to have paid at the time when they are incurred. Deduction is not allowed currently for any medical expenses that is going to be incurred in the future, subject of course to the exception that the taxpayer has an promise to pay the fees in advance under the policy of the physician or the institution furnishing the medical care.                   Works Cited   Hoffman, Smith, Wills Individual income taxes 2007Chapter 10 pp 10-2 to 10-8West Federal Taxation (Thomson)