Are Medicare premiums tax deductible?

Kimberly Lankford,

AARP

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En español

Published October 27, 2022

/ Updated January 06, 2024

Yes, your Medicare premiums can be tax deductible as a medical expense if you itemize deductions on your federal income tax return. You can only deduct medical expenses after they add up to more than 7.5 percent of your adjusted gross income (AGI).

This means if your AGI is $50,000, you can deduct medical expenses in excess of $3,750. If you had $5,000 in eligible medical expenses, you could deduct $1,250 on your income tax return.

What are the rules for itemizing deductions?

Unless you’re self-employed, you can only deduct medical expenses if you itemize rather than take the standard deduction. To make this worthwhile, your total itemized deductions — including but not limited to charitable gifts; eligible medical expenses; up to $10,000 in local and state income or sales taxes and property taxes; and tax-deductible mortgage interest — must be more than the easier-to-claim standard deduction.

You have until the April 15, 2024, tax-filing deadline to deduct eligible premiums and other expenses you paid in 2023.

What Medicare expenses are tax deductible?

If you qualify, you can deduct Medicare and other related insurance premiums when you itemize, including:

Medicare Part A, although most people don’t have to pay Part A premiums.

Medicare Part B, which was $164.90 a month for most people in 2023 and $174.70 per month in 2024. The premiums can still be tax deductible even if they’re deducted automatically from your Social Security benefits. If you have to pay a high-income surcharge for Part B premiums — also called the Income-Related Monthly Adjustment Amount (IRMAA) — your full premiums can still be tax deductible.

Medicare Part D prescription drug plans, including the high-income surcharge.

Medicare Advantage, the private alternative to original Medicare.

Medicare supplement insurance, the private plans also known as Medigap.

Long-term care insurance. In addition to Medicare-related premiums, you can also deduct a portion of premiums you pay for eligible long-term care insurance policies based on your age.

40 or younger — $480 for 2023; $470 for 2024

Age 41 to 50 — $890 for 2023; $880 for 2024

Age 51 to 60 — $1,790 for 2023; $1,760 for 2024

Age 61 to 70 — $4,770 for 2023; $4,710 for 2024

Age 71 or older — $5,960 for 2023; $5,880 for 2024

Married couples filing a joint tax return can each deduct their long-term care premiums up to the limits for their age.

Additional out-of-pocket medical expenses can be tax deductible if other insurance, such as Medigap, Medicare Advantage or retiree coverage doesn't cover the full costs. Some of these eligible costs may include:

Deductibles and copayments

Most dental, hearing and vision expenses, such as contact lenses, eyeglasses, routine eye exams, dental procedures, dentures, routine dental exams, hearing aids and hearing exams. You can also include the cost of eye surgery to treat defective vision, such as laser eye surgery or refractive surgery to correct myopia or nearsightedness.

Medical equipment, including crutches or a wheelchair, that may not be covered in full. Medical supplies such as bandages are also tax deductible.

Certain home improvements to accommodate a disability. For example, you can deduct the cost of constructing wheelchair ramps, installing bathroom grab bars and handrails, and widening doorways and hallways. If the improvement increases the value of the home, a portion of the expense will not be tax deductible.

Certain psychologist or psychiatrist care costs, even if they exceed Medicare’s coverage limits for mental health benefits.

Services Medicare doesn’t cover, such as acupuncture or chiropractor visits beyond the limited definition of Medicare coverage.

Many travel expenses to receive medical care. But lodging costs may have a daily maximum.

See IRS Publication 502, Medical and Dental Expenses, for a full list of eligible expenses and rules.

What Medicare expenses are not tax deductible?

You can’t deduct the following Medicare-related expenses.

Cosmetic surgery to improve your appearance unless the surgery addresses problems resulting from an accident, deformity or disease.

Late enrollment penalties added to Part B or Part D premiums.

Nonprescription medications, except for insulin. That includes herbal, nutritional or vitamin supplements, unless a medical provider recommends them as treatment for a specific medical condition a physician has diagnosed.

Can I deduct Medicare premiums if I’m self-employed?

If you’re self-employed, you may be able to deduct premiums for Medicare or other eligible health insurance from your income without having to itemize or meet the 7.5 percent threshold. Even if you were primarily retired but did some consulting work, you may be eligible to deduct all or part of your premiums.

You can qualify for the self-employed health insurance deduction only if both you and your spouse were ineligible to participate in an employer-subsidized health plan. The tax-deductible premiums cannot exceed the amount of money you earned from your business. The calculation is more complicated if you received a subsidy for buying health insurance on the federal or a state insurance marketplace.

If you qualify, you can deduct premiums for Medicare Part B and Part A if you’re required to pay them, as well as Part D, Medicare Advantage and Medigap premiums, and eligible long-term care insurance premiums. You can claim this deduction as an adjustment to income on Schedule 1 when filing your Form 1040.

Keep in mind

You can withdraw money tax-free from a health savings account (HSA) to pay Medicare premiums after you turn 65, including premiums for Medicare Part A, Part B, Part D prescription drug plans and Medicare Advantage. However, the IRS doesn’t allow tax-free HSA withdrawals for Medigap premiums.

You can’t make new contributions to an HSA after you enroll in Medicare, but you can make tax-free withdrawals for other eligible medical expenses at any age. You can’t take a tax deduction and tax-free HSA withdrawals for the same expenses.

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Kimberly Lankford is a contributing writer who covers Medicare and personal finance. She wrote about insurance, Medicare, retirement and taxes for more than 20 years at Kiplinger’s Personal Finance and has written for The Washington Post and Boston Globe. She received the personal finance Best in Business award from the Society of American Business Editors and Writers and the New York State Society of CPAs’ excellence in financial journalism award for her guide to Medicare.