Can You Claim Unpaid Medical Bills on Taxes?

A common question is whether you can claim unpaid medical bills on your taxes. The answer centers on a core tax principle: medical expenses are deductible only in the year they are paid, not in the year you receive the service. This means an outstanding bill from one year cannot be claimed until you pay it in a subsequent year.

The “Paid” Rule for Medical Expenses

The Internal Revenue Service (IRS) has a clear definition of what it means for a medical expense to be “paid” for tax deduction purposes. The timing of the deduction is tied to when the money leaves your control. If you pay a medical bill with a check, the expense is considered paid on the date you mail or deliver it. Payments made online or by phone are counted on the date the transaction is reported on your bank or card statement.

When you use a credit card to pay for a medical expense, the IRS considers it paid in the year the charge is made. This holds true even if you carry the balance and pay it off in a later year. For example, a $2,000 hospital bill charged to your credit card in December would be included with your medical expenses for that year’s tax return.

This contrasts with payment plans established directly with a healthcare provider. If you have a large bill and agree to pay the provider in monthly installments, you can only deduct the total amount of payments you made during that tax year. Any interest or financing charges added to the bill are not deductible.

Core Requirements for the Medical Expense Deduction

Beyond the “paid” rule, two primary requirements must be met to deduct medical expenses. The first is the necessity to itemize deductions on your tax return. By choosing to itemize, you are opting out of the standard deduction.

You should only itemize if your total itemized deductions—including medical expenses, state and local taxes, and mortgage interest—exceed your available standard deduction. For the 2025 tax year, the standard deduction is projected to be around $14,600 for single filers, $29,200 for married couples filing jointly, and $21,900 for heads of household. If your total itemized deductions are less than this amount, you will receive a greater tax benefit by taking the standard deduction.

The second requirement is the Adjusted Gross Income (AGI) threshold. Your AGI is your gross income minus certain above-the-line adjustments. The IRS allows you to deduct only the amount of qualified, unreimbursed medical expenses that exceeds 7.5% of your AGI.

To illustrate, consider a taxpayer with an AGI of $60,000. The 7.5% threshold would be $4,500 ($60,000 x 0.075). If this person paid $7,000 in qualified medical expenses during the year, they could only deduct the amount that exceeds the $4,500 floor, which is $2,500. If their total expenses were $4,000, they would not be able to deduct any of it.

Identifying Qualified Medical Expenses

To be deductible, an expense must be for the diagnosis, cure, mitigation, treatment, or prevention of disease. Payments made to doctors, dentists, surgeons, chiropractors, and psychologists for services are common examples. The cost of hospital care, including meals and lodging provided by the hospital, also qualifies. Prescription medications and insulin are deductible.

Over-the-counter drugs are not deductible unless prescribed by a doctor. The same rule applies to menstrual care products. These items can often be paid for tax-free with funds from a Health Savings Account (HSA) or Flexible Spending Account (FSA).

The costs of transportation to and from medical care are deductible. If you use your personal vehicle, you can deduct a standard rate of 21 cents per mile, along with parking fees and tolls. Medically necessary home modifications, such as installing ramps or grab bars, can be counted. Premiums you pay out-of-pocket for health insurance or qualified long-term care insurance can also be included.

Conversely, many health-related purchases are not qualified medical expenses. Expenses for general health, such as vitamins, supplements, or a gym membership, are not deductible. Cosmetic surgery is not deductible unless it is necessary to improve a deformity from a congenital abnormality, personal injury, or a disfiguring disease. Any expenses reimbursed by your insurance, an FSA, or an HSA cannot be deducted.

Documentation and How to Claim the Deduction

You must maintain proof of each expense, which can include receipts, paid invoices from providers, and credit card statements. Explanation of Benefits (EOB) statements from your insurance company are also useful. They detail what portion of a bill was covered by insurance and what amount remains your responsibility.

The total amount of medical expenses that exceeds your 7.5% AGI threshold is entered on Schedule A (Form 1040), “Itemized Deductions.” This form compiles all your itemized deductions, and the total is carried over to your main Form 1040, reducing your taxable income. You do not need to send your receipts with your return, but you must keep them with your tax records in case of an audit.