Q. Can you deduct prescription drugs on your tax return?
A. This is the time when taxpayers are looking for any and every deduction to help lower their tax liabilities.
If you are able to itemize your deductions, then you may be able to deduct expenses you paid that year for medical expenses — including prescription drugs.
You can deduct prescription drugs for yourself, your spouse and your dependents, said Howard Hook, a certified financial planner and certified public accountant with EKS Associates in Princeton.
But to take the deduction, the total amount must exceed 7.5 percent of your adjusted gross income (AGI), and if it does, only the amount that exceeds that threshold is deductible, Hook said.
The 7.5 percent of AGI applies for tax years 2017 and 2018, and beginning in 2019, the threshold amount increases to 10 percent of AGI.
“Changes to itemized deductions under the new tax law are going to result in fewer taxpayers being able to itemize and as such, fewer people, even if they do exceed the threshold for medical expenses, will be able to deduct them,” Hook said. “In essence, only taxpayers with very large qualified medical expenses will wind up being able to take the deduction.”
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