Seniors have fallen into a habit of claiming a standard deduction rather than itemizing because they practically have no mortgage interest and there is no state income tax in Florida. Therefore, itemized deductions that the rest of us commonly claim will often amount to nothing for senior citizens, according an article at SmartMoney.com.
Additionally, those who are 65 or older tend to get significant standard deductions. However, the standard deduction may not be beneficial if you are burdened with medical expenses.
Medical expenses can be deducted only when they exceed 7.5% of your adjusted gross income (AGI). When you tally your expenses, don't forget to add your Medicare insurance premiums. Medicare premiums along with out-of-pocket expenses can help you reach the 7.5% AGI parameter. This may cause your itemized deductions to surpass the standard deduction amount.
To find out if itemizing will help you cut tax bill, you should:
- Decide which expenses are medical expenses - add up your premiums for Medicare Parts B, C and D; supplemental Medicare; qualified long-term care; out-of-pocket bills; and relatives' medical expenses.
- Subtract 7.5% of your AGI for your total medical expenses.
- Add other itemized deductions and compare all deductions with your standard deduction amount.
When you've done this, you might discover that itemizing is your best bet.
Help from a Tax Planning Attorney in Fort Myers is Just a Phone Call Away
Fort Myers tax planning attorney Matthew A. Linde understands firsthand the importance of careful tax planning and the complexities of financial legal matters, such as probate, tax litigation and guardianship. For help with your tax planning concerns, contact our Fort Myers office to schedule a one-on-one meeting with a professional who can answer your questions - 239-939-7100 or 844-764-5492.