(NAPSI) — Paying for medical and dental care has become challenging for an increasing number of Americans, even for those with good health insurance coverage. Family health care premiums have increased 113 percent since 2001 according to the Kaiser Family Foundation's 2011 Employer Health Benefits Survey. The average worker contributed more than $4,100 toward employer-provided family health coverage in 2011, an amount that doesn't include out-of-pocket costs such as deductibles, co-payments, and co-insurance.
If you've spent a significant amount of money on health care, financial relief may be available in an unlikely place - as an itemized deduction on your federal income tax return.
"You can deduct unreimbursed medical and dental expenses that exceed 7.5 percent of your adjusted gross income," explains TaxACT spokesperson Jessi Dolmage. "That includes expenses paid for you, your spouse, and dependents in 2012. Even if the service was provided in 2011, you can count the expense if it was paid for in 2012."
Care includes the diagnosis, cure, mitigation, treatment, or prevention of disease, and treatments affecting any structure or function of the body. Qualified expenses paid for you, your spouse, and dependents may include:
When preparing your 2012 income tax return (due in April 2013), you'll figure your deduction on Schedule A. "Solutions like TaxACT make claiming medical and dental deductions on your tax return easy," said Dolmage. "The program helps you determine which health care expenses qualify and then calculates your deduction and fills out Schedule A for you."
Between now and tax time, keep documentation of expenses organized. "Save receipts, keep detailed notes, and save all information in one place," says Dolmage. "That'll save time when you do your taxes, and you'll have all the information you'll need to substantiate your expenses in the unlikely event of an audit."
Starting in 2013, the adjusted gross income threshold for deductible medical and dental expenses increases to 10 percent.
Learn more about deductible medical and dental expenses in IRS Publication 502 at www.irs.gov.
TaxACT Free Federal Edition provides step-by-step guidance through deductible health care expenses and other complex tax situations. Do your federal tax return for free and get unlimited free email help at taxact.com.
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