Do invisible braces count as a medical expense?
Invisible braces can be a very expensive form of treatment. However, there is a possibility to reduce this cost through deductions for qualified medical expenses. Invisible braces count as a medical expense if they are utilized for disease prevention or disease alleviation. Therefore, even if you purchase the best clear aligners on the market, there is a possibility that you can deduct a portion of the cost on your tax return. To be certain that your braces qualify, you need to understand what is a qualified medical expense first. You may also need to change the way you file your taxes and understand certain limitations. You’re in luck, though, as those topics are precisely what we will be covering in this article.
Can invisible braces count as a medical expense?
Invisible braces, for the most part, can be considered a medical expense. However, there are situations in which they are considered to be an aesthetic improvement. With this in mind, you will want to learn the answer to the following questions before you start deducting some of the brace cost on your tax return:
- What is a qualifying medical expense?
- What are the limitations?
- How do I deduct the cost of invisible braces on my tax return?
- What about my wife/child’s invisible braces?
As with anything else that concerns taxes, deducting the cost of your braces can get rather complicated. That is why you may want to explore some of the best tax relief options available to you. Since you will need to itemize to get the deduction for medical expenses, you might as well get the most out of it.
What is a medical expense?
The IRS details the qualified medical expenses under its Publication 502. An expense can be considered to be a medical expense if it involves the cost of diagnosing, curing, mitigating, treating, or preventing a disease. The expenses themselves can include payments for a wide variety of services, including those rendered by dentists. Furthermore, medical expenses also include the cost of any necessary equipment, diagnostic devices, and required supplies.
The primary reason why invisible braces count as a medical expense is the fact that they are connected to disease prevention. Even if the only thing you need your braces to do is to straighten your teeth a bit, the procedure will also involve disease prevention. Now, this may not apply in 100% of the cases. But it is usually a good rule of thumb to consider that invisible braces are eligible to become medical expenses.
That being said, there is a possibility that the IRS might think that your braces are not medically necessary to prevent/alleviate a disease. If your braces are simply beneficial to your general health, they might not fall under medical expenses. Another situation is when invisible braces do not work for you. However, these cases are very rare. For the most part, you will be able to treat invisible braces as medical expenses.
The last thing worth noting is the fact that medical expenses include all sorts of things. For example, health insurance premiums are also medical expenses. So is the transportation to the medical center and amounts paid for qualified long-term care services. Why is this important? It is because medical expenses have limitations.
The first limitation of medical expenses states that you can only deduct the amount that exceeds 7.5% of your AGI (Adjusted Gross Income). Here’s an example: Let’s say that your AGI is $80,000. 7.5% out of $80,000 is $6,000. If your sum total of medical expenses is below this number, you cannot deduct them when filing your tax return. However, this is where the term “medical expenses” comes in. It is not just the cost of your invisible braces. All the money you need to spend to prevent gum disease is eligible to be counted as a medical expense. That means the money you spend on your trips to the orthodontist’s office is also a medical expense.
While the 7.5% limitation might initially seem harsh, you will soon realize that many more expenses can be deducted as medical expenses. That will usually raise the amount to over the limitation and then some.
The next limitation is the fact that you need to spend “your own money” for medical expenses. That means that you can’t have your insurance pay for the treatment and then deduct the cost of that treatment. In other words, you can only deduct out-of-pocket costs. Furthermore, by choosing to deduct your medical expenses, you are forgoing your standard deduction. You will have to itemize instead.
Itemizing your deductions
For some people, itemizing their deductions might not be the best idea, even if there are medical expenses involved. The standard deduction amount is $12,000 for single filers, $24,000 for married joint filers, and $18,000 for heads of household. It is quite possible that by choosing to itemize, you actually lose money. Furthermore, itemizing your deductions is, quite frankly, a lot of work. If you haven’t done so before, you may want to consult a tax professional before you file your report. There are literally thousands of available deductions that you can take advantage of. But only some of them will apply to your particular situation.
You will also want to learn about itemizing before you choose your invisible braces. There are many different types of braces to consider, and being able to deduct the cost as medical expense might influence your decision. And you might want to consider invisible braces for other family members, as well.
Orthodontics for others
It is possible to include medical expenses that you pay for your spouse or your dependents. This means that you might be able to pay for the braces for the entire family and get to deduct the cost when filing your tax return. Of course, the 7.5% limitation still applies, but it is highly likely that the majority of your medical expenses will exceed that amount. Do note, however, that you can’t deduct aesthetic treatments, such as efficient ways to whiten teeth, for example, only what is medically necessary. There is some debate about whether white teeth are a medical necessity, and you might have a chance to argue your case before the IRS, but it is a long shot, so to speak.
Furthermore, your spouse or your dependents need to qualify for these medical expenses. Your spouse, for example, needs to be married to you at the time you pay for the medical expenses. As for your dependents, they need to be your qualifying child or a qualifying relative. Furthermore, they need to be U.S. citizens/nationals or a resident of the U.S., Mexico, or Canada. Lastly, they cannot have a gross income of more than $4,300, file a joint return, or be claimed on someone else’s tax return. There are a few exceptions, most notably the exception for an adopted child.
That being said, “qualifying child” is a somewhat confusing term.
What is a qualifying child?
According to the IRS, a qualifying child can be much more than your direct offspring. Your brother, sister, stepchild, foster child, stepbrother, stepsister, or any of their descendants also qualify. Even a half-brother or a half-sister and their descendants may qualify.
They also need to be under the age of 19 at the end of the year and younger than you. If you are filing jointly with your spouse, qualifying children need to be younger than them, as well. Children can qualify if they are under the age of 24 and they are full-time students. Lastly, if they are permanently and totally disabled, they can be of any age, and there is no age limit for braces. Other limitations include that qualifying children need to live with you for more than half of the tax year, do not provide over half of their own support, and do not file a joint return aside from claiming the refund.
An adopted child is treated as your own child, and you can include the payments made to the adoption agency for medical expenses in your tax return. However, you need to have an adoption agreement with the agency before they make any payments.
When it comes to children from divorced or separated parents, they can be treated as dependents of both parents in regard to medical expenses. Each parent can include the medical expenses on their tax return, even if the other parent claims custody of the child. However, the child needs to be in the custody of one or both parents for more than half a year, as well as receive over half of their support from their parents.
Invisible braces, medical expenses, and you – What is the best solution?
Even though invisible braces count as a medical expense, that does not necessarily mean you should itemize your deductions at all times. If you happen to be paying for multiple sets of braces, itemizing your tax return might be in your best interest. But if your standard deduction is higher, it is better to avoid itemizing. The best option is to consult a tax professional before making a choice. You can find all the best tax relief companies right here at Consumer Opinion Guide. Furthermore, if you have any other questions concerning braces, we are your go-to resource.